- Sharp drop in PPI is promising
- There is a lag between fall in PPI and CPI around one or two quarters
- Food prices is where inflation remains most stubborn
- Not very convincing to argue that UK grocery inflation is driven by “greedflation”
Well, for their sake, that lagged effect better kick in soon. Otherwise, stagflation risks are mounting and they will have to risk a hard landing on the economy just to bring inflation back down.
This article was written by Justin Low at www.forexlive.com. Source