July Market Commentary 2022

Economic data released in July added to existing concerns of a global growth slowdown. While inflation continued to surprise to the upside, economic growth data underperformed expectations, and consumer and business surveys pointed to a weaker outlook. While labour market strength and consumer spending will prevent the National Bureau of Economic Research from officially declaring the US is in “recession”, disappointing US growth, which saw the economy contract for the second successive quarter in Q2, will only add to concerns about the outlook.

Though the outlook is even weaker in the eurozone, given disruption to gas supplies, Q2 growth outperformed expectations on the back of a strong tourism season. Meanwhile, corporates are facing ongoing supply chain issues, cost pressures, and a weaker demand environment.

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