The Day at a Glance | December 1 2021

The Top

*Inflation is the main risk for the worldwide economy: OECD.

*J. Powell acknowledges that the FED should not label inflation as transitory and could accelerate as stimuli is withdrawn.

*OPEC+ meetings begin with expectations that plans to increase production starting in January will be stopped due to the Omicron variant.

*Economic indicators: The manufacturing ISM will be made public in the U.S. (61e.).

Economic environment

The OECD updated its global growth outlook. The Organization for Economic Co-operation and Development made its new growth estimates public this morning, along with warnings of inflationary risks. Growth figures barely changed with the organization estimating that the global economy will grow 5.6% (5.7% prev.), while for 2022, the figure was left unchanged at 4.5%. However, estimates for 2023 appeared in the report for the first time, in which a more moderate rate of growth is expected (3.2%). The OECD affirmed that the global economy has recovered strongly, especially regarding the demand for goods, which has caused saturation in the processing capacity in production chains. This has led to an overall scarcity of goods along with disruptions in the supply of food, energy and raw materials, which all contributes to greater inflation at a worldwide level. The risk is that these inflationary pressures lasting longer than initially expected would affect low-income populations and create a faster adjustment of financial conditions at a global level; something that could expose the financial system`s vulnerabilities. In Mexico`s case, the OECD revised its growth estimates downwards for 2021 and 2022. The organization now expects growth to set at 5.9% this year (vs 6.3% prev.) and 3.3% in 2022 (vs 3.4% prev.). For 2023, global growth would approach its potential to 2.5%.