Current inflation projections indicate a peak in 2022 for most advanced G20 economies. In the US, it is projected to reach 4.4% in 2022, before falling to 2.5% in 2023; euro area (2.7% and 1.8%, respectively) and UK (4.4% and 2.4%) projections indicate similar pattern, while in Japan it is projected to remain stable at 0.8% for both years. In some G20 emerging economies, such as Brazil, India and Mexico, inflation is projected to peak in 2021.
Supply and inflationary pressures have been especially acute as economies have reopened during the course of 2021. However, renewed fears over new COVID variants and associated constraints on healthcare capacity also pose a risk to the global economic recovery more broadly.