Moody’s Analytics economist Mark Zandi and his team discuss the inflation outlook, and factors contributing to their short-term and longer-term inflation forecast including supply and demand, labor costs, productivity, inflation expectations and the US Federal Reserve’s response.

Regional and local governments in emerging markets generally report weaker infrastructure and higher levels of poverty and inequality than their advanced economy peers, which weigh on their growth and financial metrics. Given their limited flexibility to address the underlying drivers, we expect that social considerations will continue to constrain their creditworthiness.

The US average family recovery rate fell to 45% for companies that defaulted during the COVID recession, down from 59% during the global financial crisis. But the default rate peak was less severe than in previous downturns, hitting 8.9% in 2020 versus 14.7% in 2009.