Review of the week

Central banks, squarely behind the curve, are preparing to raise rates swiftly. Inflation should be peaking, yet a European oil embargo is becoming more likely.

People are starting to react to increases in the cost of living, cutting non-essentials and spending less. Central banks are soon to follow suit by increasing interest rates further.

The war in Ukraine has dampened global growth as waves of COVID-19 continue to roll across the world. Meanwhile, politics is back to the fore in Europe and America.

Western central banks are trying to rebalance the scales in bond markets without causing a panic. Meanwhile, COVID-19 and bog-standard politics are still influencing markets in Europe and Asia.

Cost of living fears seem to be peaking in the UK as a raft of important protections end. How will the economy hold up as households and companies tighten their belts?

The 1970s suddenly seem relevant again given soaring oil prices, high inflation and rising interest rates. But we’re not expecting a rerun of 1970s-style spiralling prices, sputtering economic growth and weak equity market returns.

This year has been grim so far, yet equities recovered much of their losses last week. Meanwhile, oil prices are all over the place and COVID-19 is wreaking havoc in the East.

Commodity markets are fuelling further inflation and putting global growth at risk. Central banks have shown they want to unwind years of emergency monetary policy regardless, sending bond yields higher.

The war in Ukraine has united typically quarrelsome European states against Russian aggression. Meanwhile, unity in President Vladimir Putin’s nation has been enforced through the strength of an authoritarian regime.