Eurozone inflation was slightly higher than anticipated in February but it was the increase in core inflation (excluding food and energy) that caught the eye. Now, one may conclude that food and energy, although volatile, are very much ‘core’ but leaving that argument aside, if the price of everything else is still rising (at a…
Inflation looks to be moderating but the rate increases keep coming. The Federal Reserve increased U.S. rates by 0.25% to a range of 4.5% – 4.75% while the European Central Banks and Bank of England raised by 0.5% to 2.5% and 4.0%, respectively. All still have base borrowing costs meaningfully below their present rates of…
Remember last year, central banks were often using the word ‘transitory’? It’s not a word we hear, now. 2022 was the year when the sheer incompetence of modern day central banking became all too obvious. Having held the cost of money at close to zero for well over a decade, economic reality crashed through the…
According to the Organisation for Economic Co-operation and Development (OECD), the world will face a ‘significant growth slowdown next year but will avoid a global recession’. We suspect this will prove as accurate as most OECD forecasts, which is not very accurate at all. It is our belief that it is close to impossible for…
Reversion to reality continues. Last month, the US Federal Reserve, the European Central Bank and the Bank of England all raised rates by 0.75%. After more than a decade of nonsense, all are now perfectly synchronised. Is this because it is so obviously the right thing to do or are the latter two so inept…
Interest rates keep increasing, inflation keeps rising. The monetary policies of the last decade and a half are now being revealed for the experiments they truly were. As baseball legend, Yogi Berra, a man famous for colloquial expressions lacking in absolute logic yet simultaneously carrying more than a grain of truth, didn’t say but might…
The current economic mess, the creation of all central banks over the past decade, is starting to be unwound. Raging inflation has laid bare just how incompetent the guardians of our monetary systems have been. Consequently, after providing virtually free money for years, they are now aggressively raising interest rates in order to control runaway prices.…
If there was any doubt regarding how inept, gullible and arrogant the Bank of England (B of E) is, it came with its decision to raise interest rates by 0.5% to 1.75%. It’s the largest rise in 27 years, which sounds dramatic but against CPI (Consumer Price Index) inflation of 9.4%, it’s akin to calling…
From an economic perspective, it’s difficult to argue there has been any improvement over recent weeks. On the contrary, global inflation continues to rise, as do interest rates while in the UK, waves of industrial action now appear a formality. Meanwhile, Putin’s forces continue their assault on Eastern Ukraine, meaning little respite for the prices…
Markets have generally weakened as investors continue to absorb a plethora of bad news. Despite expecting inflation to be ‘transitory’, all major central banks are now not only tightening monetary policy but signalling that further rate rises are embedded in their thinking. It’s a pity their hopeless misreading of inflation has resulted in such a…