Bumps in the road to fighting inflation! An important measure of inflation expectations in the US is close to a nine-year high and in Europe it is at a 13-year high

Bumpy Road in the Fight Against Inflation! Key inflation expectations indicators in the US and Europe have reached their highest levels in 9 and 13 years respectively. The US 5-year/5-year forward inflation swap rate briefly exceeded 2.5% this week, approaching the peak reached last year, indicating that inflation expectations could be sticky and it may not be easy to bring inflation back to the 2% target.

Similarly, in the Eurozone, the same indicator reached 2.66%, the highest level since 2010, suggesting that the European Central Bank may struggle to bring inflation back to the target as well. 

news flash