ZB

Deutsche Bank warns of 'time bomb' if global economies ignore inflation

Author
Newstalk ZB,
Publish Date
Tue, 8 Jun 2021, 8:05pm
Photo / Getty
Photo / Getty

Deutsche Bank warns of 'time bomb' if global economies ignore inflation

Author
Newstalk ZB,
Publish Date
Tue, 8 Jun 2021, 8:05pm

Deutsche Bank economists have today warned that global economies are sitting on a time bomb if they ignore inflation.

The Federal Reserve in the US has said it's keeping interest rates low as it sees inflation as a temporary problem, similarly to the New Zealand Treasury.

HSBC chief economist Paul Bloxham told Heather du Plessis-Allan that western economies are reopening faster than production can keep up - and the big question is whether inflation is temporary or not. 

"A lot of that discussion is really focused on whether it gets through to the labour market - whether the lift in inflation starts to feed through to wages growth, and whether that wages growth feeds through to inflation growth, and we get this spiral picking up."

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