US Data Response Consumer Prices & Housing Starts (Oct.) October's consumer price inflation figures support the recent argument made by several Fed officials, that they would have launched QE2 even if the Fed's mandate was to target price stability alone... 17th November 2010 · 1 min read
Global Economics Update Is the latest global inflation scare justified? The markets have swung too far from worrying about deflation towards worrying about inflation. To be sure, inflation will be higher than otherwise over the next few months as a result of the recent... 17th November 2010 · 1 min read
US Data Response Industrial Production & Producer Prices (Oct.) After almost completely petering out over the past few months, October's industrial production data suggest that the manufacturing recovery may be gathering momentum again, driven by demand for... 16th November 2010 · 1 min read
Europe Data Response German ZEW (Nov.) & EZ Final CPI (Oct.) November’s rise in German ZEW investor sentiment suggests that the euro-zone’s core has remained encouragingly resilient to the periphery’s troubles for now. But we still see German growth slowing... 16th November 2010 · 1 min read
UK Data Response UK Consumer Prices (Oct.) October’s CPI figures could mark the start of a difficult period for the MPC. But we expect most members to hold their nerve and focus on the medium-term outlook. 16th November 2010 · 1 min read
UK Economics Weekly Renewed rise in inflation needn't rule out QE2 Some of the reaction to last week’s Bank of England Inflation Report - including the 10bps or so rise in bond yields - seemed a bit over the top to us. After all, the MPC’s growth and longer-term... 15th November 2010 · 1 min read
Japan Economics Update Why don't households fear deflation? Policy-makers and the financial markets may be focused on the risks posed by persistent deflation, but the latest surveys from Japan suggest that households there do not believe prices are falling and... 12th November 2010 · 1 min read
China Economics Update More tightening on the way Consumer price inflation rose more than expected last month, but it continues to be solely a food price problem. Of more concern is that loan growth has not slowed, despite strong signals from the... 11th November 2010 · 1 min read
UK Data Response Bank of England Inflation Report (Nov.) The Bank of England’s November Inflation Report suggested that the door is still open for the Monetary Policy Committee (MPC) to follow the US Fed in extending its programme of asset purchases. 10th November 2010 · 1 min read
Latin America Economics Update Inflation being driven by rising food prices... for now The raft of data released over the past day or so show that inflation across Latin America is accelerating. For now, the pick-up has been driven by food prices. But with growth set to remain strong in... 9th November 2010 · 1 min read
China Economics Update Inflation Monitor (Oct.) We think that consumer price inflation peaked in October. With all the recent increase in the headline rate coming from food prices, inflation is only likely to continue rising if there are further... 9th November 2010 · 1 min read
US Economics Weekly QE2 will not lead to runaway inflation It is very easy to understand why some fear that the Fed's second-round of quantitative easing will lead to a surge in inflation. But we suspect that the ultimate impact on core inflation will be... 8th November 2010 · 1 min read
UK Data Response Producer Prices (Oct.) October’s UK producer prices figures won’t do a great deal to ease near-term inflation concerns. But neither should they worry the MPC too much. 5th November 2010 · 1 min read
Emerging Europe Economics Update Should we worry about inflation expectations in Poland? There is little evidence to back up claims by some policymakers in Poland that interest rates should be raised in order to contain inflation expectations. In fact, doing so could entail some... 5th November 2010 · 1 min read
Latin America Economics Update Peru: Early warning signs of higher inflation in 2011 The outlook for inflation in Peru is deteriorating but the policy response is not straightforward. Interest rate hikes would only serve to increase speculative inflows of ‘hot money’, while fiscal... 4th November 2010 · 1 min read
Europe Data Response Euro-zone Flash CPI (Oct.) & Unemployment (Sep.) The latest euro-zone unemployment and inflation data attest to the absence of price pressures in the region. As inflation drops back next year, we think the ECB is more likely to up its unconventional... 29th October 2010 · 1 min read
