July 31, 2020

Fathom’s Chart of the Day 31.07.2020: After the policy splurge, is inflation on the cards?

by Fathom Consulting.

The short answer is probably not. Policy measures are cushioning and absorbing an unprecedented income shock. Even if they become more permanent, the fiscal support measures that we have seen, combined with ultra-loose monetary policy can only give rise to a sustained pickup in inflation if monetary policy becomes subordinate to fiscal policy, and we enter a world of fiscal dominance.

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This chart is taken from Fathom’s Recovery Watch newsletter. Click here to subscribe to Recovery Watch and Forums.

Next forum date: Monday 10 August 2020

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