In the 2022 energy shock (Russia’s invasion of Ukraine), central banks in the developed world had tightened faster to return policy-neutral levels. In a note dated 13 March, Neil Shearing, group chief economist at Capital Economics, said at that time they were caught on the back foot, but that is no longer the case. So, they would need clear deterioration in inflation expectations or wage trends to justify a renewed tightening cycle.
Global central banks prep to tackle an old nemesis
