Foreword

2021 was a year of clarity. Economies proved resilient and markets bounced back after the uncertainty brought on by COVID-19.

There are certainly risks we need to manage in the new year including inflation, labor shortages and a persistent global pandemic. But overall, 2022 has a strong foundation for what we hope is a vibrant cycle ahead.

As always, we remain focused on what matters most: our clients’ goals. We believe a deep understanding of your financial priorities allows us to build portfolios that can withstand the ebbs and flows of market cycles over the long run.

We rely on our world-class Global Investment Strategy Group to help us identify the risks and opportunities that investors may face. As you read our Outlook, consider it in the context of your long-term financial goals, and reach out to your J.P. Morgan advisor to see what it could mean for you and your family.

Thank you for the trust you place in J.P. Morgan Wealth Management.

Happy holidays,
Kristin Lemkau
CEO, J.P. Morgan Wealth Management

Preparing for a Vibrant Cycle

Most risk markets have delivered stellar returns in 2021 as the global economy continues to heal from the coronavirus pandemic. Yet in recent months, investors have focused on potential risks both to economic growth and market returns. Inflation is complicating central bank policy, supply shortages are hitting economic output, and COVID-19 remains a concern for consumers, businesses and investors.

At the same time, the global crisis has clearly shifted policymaker priorities, solidified household and corporate balance sheets, and accelerated innovation. This new reality may lay the foundation for a far more vibrant economic environment than the sluggish growth and weak productivity that characterized much of the 2010s. The changes could have important consequences for investors, especially those
still positioned for a reprise of the previous cycle.

To be sure, several cross-currents are in play. In the United States, the monetary policy response to price pressures and the state of the labor market will matter for markets. In China, the economic transition underway presents near-term downside risk. Over the longer term, the global economy may have to adjust to structurally slower growth in the world’s second-largest economy. Globally, the path of the virus will likely continue to have an impact on the economy.