top of page
Writer's pictureErik T. Long

How long will pandemic price pressures last?


We think a sustained period of inflation in the region of 3-4% over the coming years could be dealt with relatively easily by central banks. But if inflation were to rise much further than this, policymakers would have to raise rates more aggressively and for longer. The subsequent economic damage wouldn’t be as large as that seen in the 1980s or the Global Financial Crisis, but a global recession and the bursting of housing bubbles in some advanced economies would be difficult to avoid. That said, we should be in a moderately sustainable economy if the inflation rate maintains that 3-4% range. Yesterday, the Fed hinted at raising rates in 2022, so we will just have to keep an eye on them in the near term. At this time, we see no reason to expect a global recession starting this year.

7 views0 comments

Recent Posts

See All

Good News On the Jobs Front

This jobs number should ease some recession fears, although next weeks CPI will be a key indicator as we all know. Payrolls were up...

More Products to Manage Risk

It is incredible the products the CME Group keep developing to efficiently manage risk. Coming in October they will be releasing products...

Comments


bottom of page