The Global Multi-Asset Solutions team believes that 2022 will be a more turbulent and less rewarding year for US stocks in particular, as the Fed unwinds extraordinary monetary accommodation in response to above-trend growth, the rapidly falling unemployment rate, and elevated inflation. While solid economic growth is typically good for stock market performance, high valuations, elevated rates of inflation, and rising real interest rates seem likely to coincide with lower returns, higher volatility, and larger drawdowns than we saw in 2021.
