Global inflation update: Disinflation on track – Standard Chartered
|Headline and core CPI inflation ease globally; global PPI inflation is approaching negative territory. Inflation indicators such as freight costs, commodity prices show limited signs of inflationary pressures. Inflation remains very well-behaved in Asia, but food inflation continues to be a source of concern, Standard Chartered’s economist Madhur Jha notes.
Food inflation is a worry for Asia
“UST breakevens suggest renewed concerns about US inflationary pressures. However, on a more global basis, drivers of inflation are still subdued. Supply-chain disruptions remain limited despite the escalation in geopolitical tensions, and orders-to-inventory ratios are easing, suggesting limited inflationary pressures ahead of the holiday season. While recent China stimulus has boosted industrial metal prices, commodity prices overall have been fairly stable. China continues to export deflation, with US import prices from China (and Asia) well below those from other regions.”
“Headline CPI and PPI inflation continue to ease broadly, even in the SSA and MENA economies. Core inflation is also falling across regions, though it remains elevated compared to the pre-pandemic period. This should provide comfort to central banks looking to ease policy rates and support growth. More importantly, the momentum on both CPI and PPI inflation (3M/3M) continues to show signs of broad-based easing.”
“Among Emerging Markets (EM) economies, inflation looks well-behaved in Asia, partly due to fairly stable exchange rates this year. Food inflation, however, continues to be a source of concern for Asia, with both the momentum and annual pace of inflation picking up. A similar trend is also seen in some other EM economies, suggesting potentially a lagged impact of El Niño conditions.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.