Consumer spending on physical goods remains robust in Q1 as service spending rapidly recovers. Forty-year inflation highs, supply chain issues, geopolitics, and a tight labor market contribute to downward pressure on spending. Additionally, Bloomberg Economics estimates that policymakers in the Group of Seven countries will shrink their balance sheets by about $410 billion during the remainder of 2022. It’s a stark turnaround from last year when they added $2.8 trillion — taking the total Quantitative Easing to more than $8 trillion since Covid-19 arrived.