Thursday, Aug 19, 2010
The worms are turning
Yahoo / reuters: Bank gets benefit of doubt on inflation -- for now
Once lost, credibility can be hard to recover and spiralling inflation is hard to reverse, as Britain found to its cost in the 1970s and 80s.
"The market is vulnerable to a continuation of the trend of upside inflation surprises, so it's strange that there is no risk priced in of an earlier move," said Sam Hill, a fixed income strategist at RBC (RBCI.PK - news) .
"If I were on the MPC (A050540.KQ - news) and had accepted responsibility for hitting a 2 percent inflation target, I would be getting increasingly uncomfortable."
Posted by mark @ 02:22 PM (489 views) Add Comment
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