IMF: Inflation surge now appears less transitory - draft

Author: Adam Button | Category: News

IMF steering committee communique draft obtained by Reuters

IMF steering committee communique draft obtained by Reuters
  • Inflation dynamics require close monitoring
  • Policymakers must be ready to take decisive action on inflation
  • Inflation surge still assessed as driven by temporary factors
  • Steps need to be taken to make supply chain more resilient in the future
This captures the general sentiment on inflation. Ultimately, we're headed to a real reckoning. If they let inflation run a bit hot, it could break the long-term disinflationary impulse in developed economies -- something they've been trying to do. On the flip side, low rates and low inflation have created the bond bubble and letting the air out of that could be catastrophic.

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