The global recovery is set to decelerate amid diminished policy support, continued COVID-19 flare-ups, and lingering supply bottlenecks. In contrast to that in advanced economies, output in emerging market and developing economies will remain markedly below pre-pandemic trends in the near-term. The outlook is clouded by various downside risks, including new COVID-19 outbreaks, the possibility of de-anchored inflation expectations, and financial stress in a context of record-high debt levels.

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