While inflation slowly moves towards target levels, interest rates remain elevated, and the global economy remains relatively resilient insofar as we have managed to avoid a general recession. Fears that prolonged elevated interest rates could lead to banking failures, due to increases in loan defaults as debt servicing became costlier, did not materialise.
Furthermore, emerging market economies with their relatively frail fiscal conditions following elevated spending levels brought on by the COVID-19 pandemic, have continued to grow and the spike in inflation has generally not led to the wage-price spiral feared towards the end of 2022.
