Global Outlook 2022: bullish – selectively

Markets 360, BNP Paribas Global Markets’ strategy and economics division, examines the global outlook for 2022: Bullish ‒ selectively.

While many see a risk of stagflation, Markets 360 analysts expect global growth – China being a notable exception – to exceed both consensus and its trend rate in 2022 and 2023, and are selectively bullish on financial markets.

The emergence of the omicron variant is likely to affect the short term-path of activity and inflation but doesn’t substantially alter our positive view of the medium-term outlook for the global economy.

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Developed & emerging markets

  • Developed markets: although Markets 360 experts think headline inflation will slow; they expect underlying price pressures to keep building, paving the way for monetary policy normalisation. According to their forecast, monetary and financial conditions in 2022 will be less accommodative, with an above-trend path for GDP growth.
  • Emerging markets: With central banks under pressure to raise interest rates to fight inflation, the Markets 360 team foresees slower growth here, with exceptions. Latin America faces a risk of stagflation due to political volatility, tighter policy and structural issues, while emerging Asia is set to outperform, given a reduced need to tighten policy.
Interview on Reuters

Central banks in the Southeast Asia region have no rush to hike interest rates anytime soon and low interest rates should help with the recovery into next year.

Marcelo Carvalho, Head of Global Emerging Markets Research,
BNP Paribas Markets 360

G10 rates

Markets 360 experts expect volatility to remain high in 2022 due to the uncertainty of central bank policy normalisation. In their view, the US Federal Reserve will first hike rates in June 2022 and start quantitative tightening in 2023, while the European Central Bank is likely to maintain favourable financing conditions for longer and slow its purchases next year.


Markets 360 strategists expect bullish equity markets in 2022, particularly in H1, as long as real yields remain in negative territory.

  • NKY (Nikkei 225 index) is likely to outperform due to its relatively low valuations
  • SPX (S&P 500 index) should rise as an increase in US corporate tax now seems unlikely
  • SX5E (Euro STOXX 50 index) could move higher as experts expect a rise in consensus earnings expectations
  • MSCI EM is likely to underperform developed markets, but still deliver positive returns


Despite its overall bullish view on markets, the Credit 360 team is bearish on credit in 2022 due to quantitative easing tapering that suggests outflows at a time when issuance continues to be robust. Strategists favour loans and high yield over investment grade, but remain cautious on emerging market rates and FX.


The Markets 360 commodity desk strategy team has a bearish outlook overall on silver, copper, nickel and aluminium, expecting a short-term rise in the Brent oil price followed by a decline in 2022. While they expect base-metal prices will recover in the second half of the year, they remain bearish on gold.


After the long-awaited COP26, the focus on sustainability and ESG is likely to increase in 2022, reflected in bond market issuance that the Markets 360 team expects to rise by 60%. Key areas of change are likely to be:

  • Investment in renewable energy,
  • Electric vehicles,
  • Industry transitioning.

The Markets 360 team is confident these will result in an increase in green bond issuance from NextGenerationEU, corporates and emerging markets, with regulation helping drive strong flows into ESG-themed equities, especially in Europe.

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