Short supply, burgeoning demand: a recipe for inflation

A WALL of worry is pressuring markets at the moment. Global equities slumped 4.1 per cent in September, the first monthly decline since January and the largest fall since the pandemic reached US shores in March 2020.

We have sharply higher rates in the United States alongside emerging signs that global economic growth is slowing down; an energy crisis is stalking Europe and China; and there are wide-ranging supply disruptions ranging from commodities to even labour.

These supply issues have worsened of late, leading to fears of inflation remaining stubbornly high and disrupting global growth in 2022.