A series of crises stalled Q3 growth and present downside risk to the outlook.

Inflation fears are clearly lifting, with the latest driven by the rise in energy prices.

We have revised our global economic forecasts lower – to 5.9% for 2021. For Australia, a very sharp fall in activity in Q3 is locked in however we continue to expect a solid rebound in Q4 , and strong growth continuing into early 2022.

The sun has been shining on risk sentiment, commodity prices and commodity currencies overnight

Energy woes add to persistent supply bottlenecks in slowing global recovery.

With markets having aggressively pushed Fed pricing into 2022, it is likely there is some thought that such a tightening will weigh on demand earlier.

The ‘Quit Rate’ is the highest on record, reflective of the ease which workers are switching jobs, in part at least for better pay or conditions elsewhere.

We are unlikely to get a true read of the underlying pace of inflation until mid-2022, with both transitory and policy driven impacts continuing to play out.

The rise in energy prices is fuelling concerns that the transitory lift in inflation seen in the wake of the pandemic may prove to be longer lasting.