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How other central banks are fighting inflation: The Economist
The better-than-expected May employment report has reignited the debate on the Federal Reserve's handling of inflation. Stephen Weeting, Chief Investment Strategist and Chief Economist at Citi, appeared on Market Domination Overtime to share his insights on how other central banks around the world are managing inflation. “Japan is the exception, and there is growing pressure to raise interest rates there. The European and US cases are not as different as people think. If you take the ECB's uniform inflation rate for the euro zone and the same measure in the US, and you only take into account one factor, owner-occupied equivalent rent, the US has more inflation than Europe. Sustainable interest rates may be higher, but I don't think that really tells you anything different. This monetary tightening policy will interact with the labour market, and we will see a cooling and inflation. Looking 12 months ahead, it's probably not going to be maximum employment. So I think the Fed will do what the ECB did and cut the policy rate a little bit,” Weeting told Yahoo Finance. For more expert insights and the latest market developments, click here to watch this full episode of Market Domination Overtime. This post was written by Nicholas Giacobino.
