Category: financial markets

Inflation risks are building – but does anybody care?

Many people have already written about how the ‘spectre of inflation’ has returned to haunt global investors. In reality, financial markets are still surprisingly relaxed about the risks, and most measures of inflation expectations have risen only slightly. This seems increasingly complacent. In part this reflects the persistently dovish messages from the world’s major central … Continue reading Inflation risks are building – but does anybody care?

It’s time to pause QE

Consumers, businesses, and investors are increasingly optimistic about the prospects for the UK economy, and independent forecasts are continually being revised up. Policymakers at the Treasury and Bank of England should now be reassessing their plans too. The consensus at the start of the year was that UK GDP would grow by around 4% in … Continue reading It’s time to pause QE

How much should we worry about inflation?

Many people have written about how the ‘spectre of inflation’ has returned to haunt investors. In fact, the financial markets are still remarkably sanguine, reassured by dovish comments from central banks. This was reasonable in the depths of the Covid recession. Now it looks increasingly complacent. There has already been a sharp rise in government … Continue reading How much should we worry about inflation?

Sense checking the Chancellor’s £25bn

Rishi Sunak is warning that a one percentage point increase in the interest rates paid on government debt could add £25bn to the annual debt interest bill. Does this stack up? And how worried should we be? For a start, the £25bn figure is factually correct. There has been some confusion about this on Twitter, … Continue reading Sense checking the Chancellor’s £25bn