Central Bankers falling behind the curve.
Short thread🧵
Short thread🧵
Economies across the world are seeing high inflation. US inflation touched 7.5% (something that hasn’t been seen in the last 40 years or so).
The eurozone inflation has gone up to a 25 year high of 5.1% in January 2022.
The eurozone inflation has gone up to a 25 year high of 5.1% in January 2022.
Central Banks have been slow to raise rates across the world even though inflation has gone up to multi-year highs.
Ideally, rates should have been increased before inflation levels rose so high.
Ideally, rates should have been increased before inflation levels rose so high.
Coming to India, while inflation has not risen that sharply "yet", savings in banks have been earning negative returns due to low rates.
This results in indirect exploitation of "savers" who see their capital depleting over time.Concerns over creeping inflation are also there.
This results in indirect exploitation of "savers" who see their capital depleting over time.Concerns over creeping inflation are also there.
Who would have thought that there would be a time when market participants would ask central banks to start increasing rates and focus on inflation!
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