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Monthly Insights - November

Khatija Haque - Head of Research & Chief Economist
Edward Bell - Senior Director, Market Economics
Daniel Richards - MENA Economist
Published Date: 28 November 2022


As we head into the final stretch of 2022, the focus remains squarely on developed market central banks which are all expected to raise rates again in December in the face of still-high inflation. For the Federal Reserve, the increase is likely to be “just” 50bp rather than the 75bp they have delivered at each of the last four meetings, but policy makers have made it clear that markets should not assume they are close to pausing or pivoting.

The unprecedented monetary policy tightening this year is expected to weigh on global growth in 2023, with the Eurozone and the UK forecast to contract and the US economy flirting with recession as well. Against that backdrop, the GCC economies are likely to remain relative outperformers in terms of growth, although the pace of expansion will likely slow.

For the oil importers of the wider MENA region the outlook for next year is less buoyant, with those countries also buffeted by the ongoing monetary tightening in developed markets. Egypt has secured a new IMF deal after months of negotiations, and progress on structural reforms will be key.

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