United States:
Fed Leaves Gradualism Behind With Urgency on Rates, Assets
“Federal Reserve officials are preparing to move quicker than the last time they tightened monetary policy in a bid to keep the U.S. economy from overheating amid high inflation and near-full employment. Prospects for another year of growth above the economy’s speed limit with inflation already strong — along with a larger balance sheet that’s suppressing longer-term borrowing costs — “could warrant a potentially faster pace of policy rate normalization,” minutes from the Dec. 14-15 Federal Open Market Committee meeting said Wednesday.”
Europe:
Inflation Pressures Growing in the U.K., Says NatWest’s Davies
“The U.K. is facing further strain from inflation, with pressure growing from import costs and a tight labor market, according to Howard Davies, the chairman of Natwest Group Plc. “I do find it quite worrying in the U.K. because we’ve got a peculiar labor market with a lot of vacancies,” Davies said in a Bloomberg TV interview Thursday. “A lot of people have left the labor market but it appears many of them are not coming back.” Index-linked pension rises and a looming jump in retail energy prices will also play a part, he said.”
Asia:
India Rate Hikes Inevitable as Inflation Surges, Nomura Says
“The Reserve Bank of India will likely start raising borrowing costs from April as fresh curbs to tackle a resurgent Covid-19 outbreak could disrupt supply chains and drive consumer prices higher, according to Nomura Holdings Inc. “It’s a more complicated situation for RBI, but substantial further delays in normalization would be tough because the global monetary policy backdrop is changing,” Sonal Varma, chief economist for India and Asia ex-Japan at Nomura, said in an interview to Bloomberg Television’s Rishaad Salamat and Haslinda Amin.”
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