IBTK - Inflation - Really Nothing To Worry About?

• The longer a period of elevated inflation - or at least fear of elevated inflation - persists, the higher the risk that a perceived transitory phenomenon could become permanent.
• We still believe this period will be transitory, but the transition period looks longer and wobblier than previously anticipated.
• For the eurozone, inflation is currently still mainly driven by base effects, while the US is already seeing a strong increase in three-month inflation as well.
• All central banks’ eyes will be on labour markets and wages and any sign of a wage-price spiral.

For further details see: