Sentences with phrase «higher inflation risks»

«In the face of higher inflation risks, there is a greater need now to proceed with monetary policy normalization.»

Not exact matches

«We must be mindful of the risk that a further rapid depreciation could push overall inflation higher relatively quickly,» Poloz said.

Number one is: Can earnings and growth outpace the risk we see in higher inflation and interest rates?

Combined with the loose - money policies at all the major central banks, high inflation is an increasing risk.

With no signs of creeping inflation, it doesn't hurt for the Fed to keep the pedal on the monetary metal, while removing stimulus too early could risk forcing interest rates and the dollar unnecessarily higher, putting a damper on the recovery.

High interest rates, of course, can compensate purchasers for the inflation risk they face with currency - based investments — and indeed, rates in the early 1980s did that job nicely.

With the economy already at full employment and more and more signs of higher wage and unit labor cost inflation, the risks are rising that it will be PCE moving up to CPI.

Other reasons for an increase include heading off a deflationary debt spiral, and conversely, the risk of very high inflation.

Bernanke strongly defended the U.S. central bank's bond - buying stimulus, saying he sees little risk of higher inflation in the near term.

That's why the risk of a U.S. inflation problem eventually hitting the world economy remains high.

We believe that the downside risk is that the economy enters a period of «overheating» characterized by rising inflation and higher interest rates.

Meanwhile long rates are finally beginning to nudge higher despite demographic trends, structurally elevated risk aversion, stubbornly low inflation, strong institutional demand for long - dated bonds and quantitative easing (although less relevant to Canada).

The dead - body business is seen as highly predictable, uncorrelated with other industries, inflation - linked, low - risk and high - margin.

If, on the other hand, central banks ignore inflation concerns and keep buying, inflation and risk may move higher in tandem.

This means higher inflation expectations would be perceived as a problem for risk markets.

Although some are concerned about potential inflation and higher interest rates, we still enjoy an environment of synchronized global economic growth and muted macro risks.

In this new normal, recessions will tend to be longer and deeper, recoveries slower, and the risks of unacceptably low inflation and the ultimate loss of the nominal anchor will be higher (Reifschneider and Williams 2000).

These risks can be high even with low growth and inflation, the traditional focus of central banks.

High valuations, political risk and, yes, inflation are all risk factors looming in the year ahead.

If there is a danger that monetary policy will be seen as «too difficult», there is also a risk that too much will be expected of it or, at least, that its success or failure will be judged against an impossibly - high standard: it can't cure the business cycle; it can't reduce inflation costlessly; and it can't be operated with surgical precision.

Equally importantly, a global shift to allow higher inflation would run the very real risk of undermining trust in central banks and their commitment to price stability.

Carl Weinberg, High Frequency Economics Founder, says the market should be thinking about inflation risks but it's not currently.

Comparing our opportunity to Japan's, isn't our sovereign credit risk much higher than Japan's in terms of per capita GDP growth, structural balance - of - payments deficit, history of default and history of inflation?

To illustrate how these risks may play out for different types of investors and strategies, consider how inflation affected performance in the most extreme historic example of high and rising inflation — the late 1960s and 1970s.

Adam Posen, Peterson Institute of Economics, says he still doesn't think inflation risks are very high.

In other words, inflation does not need to be high or rising to represent a risk to an investment strategy; it should be a key consideration for managing portfolio risk in any scenario.

* Determining the most appropriate way to manage inflation risk will therefore be highly dependent on both the perceived risk of higher inflation and the key considerations unique to each investor and investment strategy.

The 1970s were clearly an extreme example of high inflation and might be considered a worst - case scenario for inflation risk.

Moreover, a sustained move toward higher inflation is a risk to most investors and investment strategies, given that rising inflation has historically been a drag on equity and bond returns, making diversification beyond mainstream asset classes more critical.

International investments, particularly investments in emerging markets, may carry risks associated with potentially less stable economies or governments (such as the risk of seizure by a foreign government, the imposition of currency or other restrictions, or high levels of inflation or deflation), and may be or become illiquid.

Among them are factors I've discussed at length elsewhere — a weaker U.S. dollar, a steadily flattening yield curve, heightened market volatility, overvalued U.S. stocks, expectations of higher inflation, trade war jitters, geopolitical risks and more.

The recent burst of volatility has been unnerving, but it is important to remember that the macro environment of synchronized economic growth and muted macro risks remains solid, although some are concerned about potential inflation and higher interest rates.

However, we must be mindful of the risk that a further rapid depreciation could push overall inflation higher relatively quickly.

Central banks may forestall these defaults by pumping even more money into the economy — at the risk of higher inflation in coming years.

When it happens it will likely be for a number of different reasons including a combination of higher economic growth, higher inflation, lower risk aversion or a pullback in bond purchases by the Fed.

Under these conditions, there is substantial risk that the additional stimulus from larger deficits will lead to higher inflation and interest rates.

This is because interest rate changes have their largest effect on inflation risk, while stronger macroprudential settings will lead to a higher quality of household indebtedness over time.

A comeback of inflation and Fed normalization may create a challenge for investors looking for high risk - adjusted returns.»

Despite the risks to the debt burden, Moody's baseline scenario is that the debt - to - GDP will remain below 60 %, mitigated by the strong nominal GDP growth due to high inflation and the existence of government financial buffers (around 14 % of GDP).

As the Fed tapers, many observers worry about the effect on the stock market, while others are worried about the risk of inflation or deflation and everybody is worried about the effect of higher interest rates on economic growth and for the bond market.

Even if you manage to keep up with inflation, you may be taking the risk that your money may not grow fast enough without the higher returns generated by stocks to meet your major financial goals in the years ahead.

If inflation risks continue to rise and the Fed tightens, it should push rates higher for a variety of bonds.

The November Statement identified the pick - up in world oil prices in the second half of 2004 as the major risk to the inflation outlook, and the higher level of oil prices did contribute to the upstream inflationary pressures in producer prices in the December quarter.

Draghi said Wednesday that higher inflation, not growth, is the «very clear condition» for the central bank to end its bond - buying stimulus program, and that risks to the outlook remain.

As usual, I don't place too much emphasis on this sort of forecast, but to the extent that I make any comments at all about the outlook for 2006, the bottom line is this: 1) we can't rule out modest potential for stock appreciation, which would require the maintenance or expansion of already high price / peak earnings multiples; 2) we also should recognize an uncomfortably large potential for market losses, particularly given that the current bull market has now outlived the median and average bull, yet at higher valuations than most bulls have achieved, a flat yield curve with rising interest rate pressures, an extended period of internal divergence as measured by breadth and other market action, and complacency at best and excessive bullishness at worst, as measured by various sentiment indicators; 3) there is a moderate but still not compelling risk of an oncoming recession, which would become more of a factor if we observe a substantial widening of credit spreads and weakness in the ISM Purchasing Managers Index in the months ahead, and; 4) there remains substantial potential for U.S. dollar weakness coupled with «unexpectedly» persistent inflation pressures, particularly if we do observe economic weakness.

The Board's assessment throughout this period has been that, with strong growth, a gradual increase in underlying inflation, and firming demand for credit, interest rates needed to rise to lessen the risks of higher inflation in the future.

«Any further stimulus only increases the long - term risk of inflation, which we already view as high.»

In my opinion, higher inflation is a much bigger risk than rising interest rates when it comes to bond performance.

It may be too soon to hedge with gold... Unless we have high inflation, or... other risks like depression, gold looks toppy.»

Higher - than - expected inflation is also a potential risk for emerging markets where central banks have less sophisticated policy tools than the Fed for combatting higher inflHigher - than - expected inflation is also a potential risk for emerging markets where central banks have less sophisticated policy tools than the Fed for combatting higher inflhigher inflation.