Investment Institute
Macroeconomic Research

Omicron update: Boon or Bust ?

  • 01 February 2022 (7 min read)

Key Points:

  • Since the Omicron variant emerged it has quickly become the dominant COVID-19 strain. Global cases have surged, but also retreated more quickly. Moreover, severe cases have increased proportionally far more slowly.
  • Government restrictions have been mixed, if more muted, but individual behaviour has adjusted to Omicron – so we expect a weaker fourth quarter 2021 (Q4) and first quarter 2022 (Q1) in most economies. Activity is likely to rebound quickly and annual growth outlooks are broadly similar for developed economies.
  • Emerging market (EM) economies will also be disrupted. The apparent lower severity of Omicron may be a boon for EMs if it makes people more resilient to future waves of the virus, something that could lift activity faster in the second half of 2022 and beyond. However, the risks from disruption are higher in EMs. Moreover, China faces a specific risk if its ‘zero-COVID’ policy is breached.
  • Inflation is likely to remain elevated for several months longer because of Omicron but should still be in visible retreat from the spring – and may fall further if a benign outlook for EMs emerges. Yet risks to EMs and China pose upside risks to inflation rates globally.
Download the Insight
Download report (684.63 KB)

Related Articles

Macroeconomic Research

India’s economy: A compelling growth and investment story but challenges remain

  • by Danny Richards
  • 11 June 2024 (10 min read)
Macroeconomic Research

Eurozone corporate profits outlook: How they could influence the ECB

  • by Hugo Le Damany
  • 31 May 2024 (10 min read)
Macroeconomic Research

Will the US presidential election endanger an investment boom?

  • by David Page
  • 20 May 2024 (10 min read)


    This document is for informational purposes only and does not constitute investment research or financial analysis relating to transactions in financial instruments as per MIF Directive (2014/65/EU), nor does it constitute on the part of AXA Investment Managers or its affiliated companies an offer to buy or sell any investments, products or services, and should not be considered as solicitation or investment, legal or tax advice, a recommendation for an investment strategy or a personalized recommendation to buy or sell securities.

    It has been established on the basis of data, projections, forecasts, anticipations and hypothesis which are subjective. Its analysis and conclusions are the expression of an opinion, based on available data at a specific date.

    All information in this document is established on data made public by official providers of economic and market statistics. AXA Investment Managers disclaims any and all liability relating to a decision based on or for reliance on this document. All exhibits included in this document, unless stated otherwise, are as of the publication date of this document.

    Furthermore, due to the subjective nature of these opinions and analysis, these data, projections, forecasts, anticipations, hypothesis, etc. are not necessary used or followed by AXA IM’s portfolio management teams or its affiliates, who may act based on their own opinions. Any reproduction of this information, in whole or in part is, unless otherwise authorised by AXA IM, prohibited.