US inflation: unthinkable?
Article Abstract:
Morgan Stanley sees dangers from a rise in commodity prices, wage rises, and loose policy, which could lead to a rise in US inflation. Wages are likely to rise in line with productivity, while economic growth could also lead to inflationary pressure. The government does not appear to be committed yo controlling inflation, since US rates have been reduced, though the labor market is tight. Consumer price inflation may reach 4% for 1997, which is above forecasts, though better than the record of the previous two decades.
Publication Name: Investors Chronicle
Subject: Business
ISSN: 0261-3115
Year: 1996
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US: going up
Article Abstract:
Paribas Capital Markets sees US interest rates as likely to rise with a possible 0.25% rise on Sep 24 1996 and a further rise of 0.25% in Nov 1996. Emnployment growth has lowered unemployment and wage growth is less constrained. Pay inflation is increasing and the minimum wage has been raised. Petroleum prices are rising and an airport tax also puts pressure on inflation. Share prices could drop sharply if interest rates are raised and this would help reduce consumer spending so ease inflationary pressure.
Publication Name: Investors Chronicle
Subject: Business
ISSN: 0261-3115
Year: 1996
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US interest rate debate heats up
Article Abstract:
US interest rates are unlikely to be raised in Aug 1996 and the need to raise rates is not urgent as inflation is subdued. There is a debate as to whether inflation will rise. Consumer spendinglevels for Jun 1996 were little above those of April 1996. Manufacturing activity was flat in Jul 1996. Some analysts are concerned that economic growth will be strong enough to boost inflation so interest rates. This uncertainty has left financial markets sensitive to releases of economic data.
Publication Name: Investors Chronicle
Subject: Business
ISSN: 0261-3115
Year: 1996
User Contributions:
Comment about this article or add new information about this topic:
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