GLOBAL economic growth prospects are holding strong for this year and next, despite a significant majority of economists in recent polls warning new variants of the coronavirus pose the biggest risk to that outlook.

A global survey of nearly 500 economists taken this month also concluded recent rising inflation in key economies around the world would be transitory.

The global economy was now forecast to expand a sizzling 6 percent this year, which would be its fastest in nearly half a century, followed by a still-robust 4.5 percent in 2022. Both were marginal increases from the April poll.

Slightly more than half the 48 economies polled on each quarter were upgraded for both years.

But a surge in the latest variant of the virus, which has kept the delayed Tokyo 2020 Olympics an event without spectators, is a reminder vaccinations may have improved but the pandemic has not gone away.

“In recent weeks, financial markets have caught up to the idea that the COVID crisis is not entirely over. The Delta variant adds to the challenge, raising the number of cases and the threshold for herd immunity,” said Ethan Harris, global economist at Bank of America Securities.

“Overall, we see the Delta surge as a moderate headwind to global growth, but as new information comes in, we can be persuaded otherwise.”

Financial markets are on edge ahead of the U.S. Federal Reserve’s meeting this week, where policymakers are grappling with increased coronavirus infections and a disrupted global supply chain that could induce more price pressures.

As for risks to the global economy, nearly 80 percent of economists, or 160 of 202 responding to an extra question, said the biggest was a spread of new coronavirus variants.

(SD-Agencies)