Morgan Stanley chairman and CEO James Gorman said at the Global Financial Leaders' Investment Summit in Hong Kong on Wednesday that the world will still face higher inflation and interest rates over the next few years.

He said the global economy is going through a "painful transition" after years of monetary stimulus by central banks.

Gorman also said he expects central banks around the world to take further steps to rein in inflation.

"My gut is the central banks will in aggregate tame inflation. I think it's highly improbable we get back to the kind of 1-2 percent inflation we enjoyed before this crisis, more like around 4 percent over the next few years," he said.

"And we'll have to deal with that. We'll have interest rates somewhere between 4 and 5 percent, we'll have inflation around 4 percent, this is globally. And obviously unemployment is going to tick up during this period."

He added that rising interest rates shouldn't surprise anyone because they were previously at "abnormally low" levels.

Another participant at the summit, chairman and CEO of Goldman Sachs, David Solomon, said he's not sure what the path of a global recovery would look like, adding that there will be further market volatility in the next one to two years.

"What we're wrestling with at the moment is there's just a lot of uncertainty as to what that path is," Solomon said.

"But the path of how we navigate through, how far central banks have to actually go to tame inflation, do they get to a resting point and make progress, or do they have to go meaningfully higher and then back up... all those things are going to have an impact.

"So I still say that the path, you know, in my mind is quite uncertain."

Speaking on the same panel, the president of Bank of China, Liu Jin, said geopolitical concern is one of the major risks for the financial markets.

But he also assured investors that the China's property woes, such as liquidity problems faced by developers and delays in construction, have now been resolved thanks to government support.