Episode 300: Economy on Sound Footing Entering 2022, Providing Solid Backdrop for REIT Performance
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The economy will enter 2022 on a firm footing and should be able to withstand a variety of challenges that have emerged in recent months, providing a backdrop for continued solid REIT performance, says Nareit Senior Economist Calvin Schnure.
Schnure noted that the economic mood has shifted over the last couple of months, reflecting the new Omicron COVID-19 variant, supply chain issues, price spikes, and labor shortages, among other issues.
\\u201cOverall, though, the economy is quite sound. It has a lot of strength and should be able to handle these challenges pretty easily in the year ahead,\\u201d Schnure said, particularly since many of the current challenges are related to the pandemic and should ease as COVID cases come down.
As for the hot topics of inflation and interest rates, Schnure pointed out that inflation is still very connected to short-term bottlenecks. \\u201cWe\\u2019re going to see continued concern about inflation, which the Fed is going to be watching closely,\\u201d he said, with gradual increases in interest rates likely to begin around the middle of next year.