2021-10-04-牛津经济研究院-Global_Risk_metrics_show_worsening_growth_inflation_trade-off_3页_450kb

Summary of the Economic Risk Report

Key Findings

• Global economic outlook is deteriorating, with risk-weighted growth prospects weakening in 2021 and little change in 2022, while 2023 and beyond show improved prospects.
• The trade-off between growth and inflation is worsening in the near term, as metrics indicate higher inflation risk despite lower growth expectations.
• Risks to the baseline growth forecast are tilted to the downside, though upside risks remain material, supported by evidence from past forecast errors.
• Business and professional forecaster perceptions have improved since late 2020, with sentiment steady in recent surveys.

Core Elements

• Alternative risk metrics, such as those from businesses, households, and investors, align with an overall risk assessment showing a slight deterioration in risk-weighted growth outlook for 2021 compared to previous quarter, with forecasts now less optimistic.
• For inflation, metrics point to increased pressure in the short term, with professional forecasters revising upward their probability of inflation surprises, despite medium-term risks perceived as limited by businesses.
• Historical data, including past pandemics, suggest growth will likely experience demand-and-supply shortfalls, supporting a moderately weaker outlook.
• Inflation expectations have risen significantly this quarter, contrasting with last quarter's low probabilities of high inflation scenarios.

Validation and Prevalence

Most metrics corroborate the view that risks are downward-biased and scope for upside exists, with slight increases in growth risk weighting this quarter, primarily due to inflation concerns worsening the trade-off in near-term forecasts.