As we enter the third quarter of 2022, there are several historical trends we can use to provide some perspective on current events. We take a look at historical recession periods, consumer sentiment index, average annual returns at different inflation rates, and S&P 500 index price after midterm elections.

Investors in 2022 are faced with a backdrop of negative information – from elevated inflationary conditions for consumers to the Russian invasion of Ukraine – and the result has been a drop in financial markets coupled with an increase in economic and market volatility. Find out more in the INTRUST Quarterly Perspectives for Q1 2022.

Global economic growth over the past two years largely has been affected by the mandated shutdowns and fiscal stimulus in response to the COVID-19 pandemic. As the U.S. economy continues to recover in 2022, it faces headwinds of labor shortages, supply chain disruptions, and higher inflation. We evaluate the current economic environment and its implications for businesses and investors.

In our INTRUST 2021 Economic Outlook, we identified three scenarios on the speed of the U.S. economic recovery, noting that if our most optimistic scenario unfolded, unanticipated increases in inflation could emerge. Through the third quarter of this year, the U.S. has indeed experienced elevated levels of inflation, primarily caused by disruptions in the global supply change and labor shortages.

At midyear, the economy is poised to surpass pre-pandemic levels. The stock market has shown amazing resiliency, while fixed income returns remain muted. What might be next for the economy and markets? This midyear outlook attempts to answer this question by reexamining the economic conditions both nationally and locally and assessing the current market environment.

In the INTRUST 2021 Economic Outlook, our view of the economic recovery occurring throughout 2021 is based on several factors, not the least of which is the mitigation of the negative impacts of COVID-19. As the economy improves, the likelihood of inflation and rising interest rates will play an important role in market performance.