The Upside Of Eurozone Inflation
Callum Thomas | Aug 03, 2017 12:34AM ET
Most analysts continue to be too bearish on the inflation , and this will have important implications for global markets: it makes it harder to the ECB to keep easing, and this will ultimately put upward pressure on bond yields and that will echo across global asset prices in this increasingly financially integrated world.
The historical link is that wage growth tends to accelerate when the unemployment rate is falling, so we should start to see gradual upward pressure on wages in the Eurozone.
Ongoing property price growth should add impetus to the nascent rebound in core inflation seen in the Eurozone, adding to the upside case for inflation, and making life harder for the ECB.
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