The spectre of inflation is haunting markets - Rabobank

Analysis General

Published: 2/15/2018 12:53:00 PM
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Analysts at Rabobank explained that the spectre of inflation is haunting markets, for a significant pick up in US wage growth would fully put the pressure on the Fed to speed up its tightening cycle

Key Quotes:

"The spectre of inflation is haunting markets as strengthening global growth has raised concerns about a concomitant rise in price pressures. 

The surge in volatility really got a grip on markets after the release of the January Employment Report, which showed that average hourly earnings rose 2.7% (y-o-y) in December and 2.9% in January. 

This is the fastest pace of earnings growth since the financial crisis. The strengthening in wages was to some extent already visible in the (broader) Employment Cost Index, which showed that wages and salaries rose by 2.6% annualized in the fourth quarter of 2017.

This rise is also backed by survey evidence: the January release of the NFIB small business survey points at increasing wage pressure. The share of firms planning to raise wages rose to 24%, whereas even 31% of firms reported to have increased wages in the last three months."



Tag: General
Source: FXSTREET
Views: 93 times

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