Stagnation is global economy’s biggest risk in 2022: report

RIYADH: Stagnation is more of a risk to the global economy in 2022 than stagflation, according to a report from Japanese company Nomura Holdings.

In a 2022 outlook report released on Friday Dec. 10, economists at the firm warned that many countries will see a “dominance of cost-push inflation — the bad type of inflation that squeezes profit margins, erodes real household income and tends to self-correct when demand is weak.”

This will come as economies across the globe are still seeking to get back on their feet after the COVID-19 pandemic.

Growth could slow as profits fall, household income is squeezed by higher inflation, and demand drops as people opt to put money into savings.