One consequence is that inflation fears could
lead to inflation through massive deployment of money into inflation - hedging assets such as commodities.
Not exact matches
The fuel price increases will filter
through the economy, said McTeague,
leading to less discretionary spending, higher
inflation rates and fuel premium increases for truck, rail and air transport of goods.
The
inflation wars of the 1970s and 1980s
led to a broad consensus on two fronts among academics and policymakers: First, central banks are responsible and accountable for price stability, which was often acknowledged
through the formal adoption of an
inflation targeting framework.
The introduction of the major elements of the new tax system in July will
lead to temporarily higher CPI
inflation in the September quarter 2000, followed by a period of time during which reductions in various taxes flowing
through to prices will reduce measured
inflation.
Domestic inflationary pressures, associated with higher wages and incomes, will
lead to higher
inflation for non-tradable goods and services but, at the same time, the gradual pass
through of the initial exchange rate appreciation will
lead to lower
inflation for tradable goods and services (whose prices in foreign currency terms depend
to a significant extent on global considerations).
Wage bargaining generally may not be very responsive
to unemployment; wage bargains in a particular
leading sector may reflect conditions in that sector, but then be transmitted,
through concerns about relativities, into other sector s which experience quite different conditions; wage negotiator s may have unduly high expectations of future
inflation in mind when striking their bargains.
Add those
to wage and cost
inflation, on top of a flat cash settlement, and it
leads to a position where many schools are already
through their reserves and most will start
to hit negative positions next year.
Gold is often viewed as a safe haven asset as it has preserved its value in real terms
through hundreds of years of history, but this
leads to its market price often becoming overly speculative at times when people are worried about
inflation which can cause its spot price
to fluctuate wildly.
The fuel price increases will filter
through the economy, said McTeague,
leading to less discretionary spending, higher
inflation rates and fuel premium increases for truck, rail and air transport of goods.
That is, until QE appears,
leading to temporary
inflation of assets
through sucking in a decent chunk of the safest part of the intermediate fixed - income universe, forcing a temporary increase in risk taking.