Quotes from Societe Generale Cross Asset Research:
-Inflation is unlikely to abate as fast as we previously anticipated
in most countries, despite the global economic slowdown. Three major
factors are contributing to a temporary rise in inflation.
-Firstly, oil prices have bounced back over the summer. Secondly, the
recent lift in grain food prices is a source of concern, in particular
in many emerging countries. Lastly, indirect taxes are set to rise in
some countries (euro area, Japan).
-Inflation has been quickening but second-round effects are virtually
nonexistent, notably because credit growth remains lacklustre. From a
monetary policy point of view, the key consequence is that the two
tail risks, deflation and inflation, are remote over the medium term.
This has left central banks with room for manoeuvre to focus on
reviving credit growth.
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