Vikram Kotak, Chief Investment Officer, Birla Sun Life Insurance Oct 9, 2009
The RBI faces a challenge on calibrating interest rates maintaining growth momentum and managing inflationary expectations. I think India will be first to tighten the policy rates, and will be followed by emerging Asian countries in the first quarter of 2010. (India Times)
Is it wise to buy gold with borrowed money? Oct 8, 2009
Gold prices were also being lifted by long-term inflationary expectations. Apart from the dollar weakness, strength in gold has also been driven by long-term inflationary concerns. (India Times)
Rajiv Anand, MD & CEO, Axis AMC Oct 3, 2009
From a policy perspective, RBI will continue to balance growth and inflationary expectations. RBI will also have to consider expansionary fiscal policy and its impact on long-term rates. (India Times)
'Need to check inflationary expectations' Oct 3, 2009
Need to check inflationary expectations' - India Business - Business - NEWS - The Times of India ... Need to check inflationary expectations ... GANGTOK: Reserve Bank of India (RBI) governor Duvvuri Subbarao has said the Central bank needs to control inflationary expectations and support growth, as signs of recovery and price pressures raise concerns that the policy may be tightened in late 2009 or early 2010. (India Times, India -- Intl Business)
Inflation rises to 0.37% on food surge Sep 25, 2009
With a better mechanism in place to manage the inflationary expectations the pace of rise in food prices will cool off, he said. Annual inflation measured by the Wholesale Price Index (WPI) for the week rose to 0. (India Times)
Policymakers not sure whether to jump or duck Sep 23, 2009
Not only does Asia have a favourable growth forecast, but its inflationary expectations are benign. The ADB expects inflation to average 1. (Business Report, South Africa)
* High stakes in the search for a fiscal exit strategy Sep 20, 2009
When that happens, inflationary expectations will mount, long-term government bond yields will rise, mortgage rates and private market rates will increase and one would end up with stagflation (inflation and recession). So how should we square the policy circle. (Taipei Times, Taiwan -- World Business)
South Korea showsrecovery skills Sep 11, 2009
The recovery has been sufficiently strong for central bank governor Lee Seong-tae, whose term ends next March, to surprise observers by announcing his readiness to raise rates, if necessary even in the near future, to tamp down inflationary expectations arising from growing optimism and the existing loose monetary policy. On Thursday, the central bank kept its key interest rate unchanged at 2% for the seventh month running, meeting. (Asia Times Online)
Inflation inches up to -0.12% Sep 11, 2009
She also cautioned about the impact of inflationary expectations on the interest rate in bond markets. The annual inflation for food articles moved up to 14. (India Times)
Will India be able to maintain GDP growth depsite drought like conditions? Sep 1, 2009
"I think by January they would want to send some kind of monetary signal to thwart inflationary expectations," said Abheek Barua, chief economist at HDFC Bank in New Delhi. "By the April policy meeting, we will see the first rate hike of 25 basis points preceded by a 50 basis point increase in CRR (cash reserve ratio)," he said. (India Times)
Indias economy grows 6.1% in June quarter Sep 1, 2009
I think by January they would want to send some kind of monetary signal to thwart inflationary expectations, said Abheek Barua, chief economist at HDFC Bank in New Delhi. The services sector, which accounts for more than 57% of the economys output, grew an annual 7. (The Star Online, Malaysia -- Business)
* PRC optimistic on inflation, but orders officials to be alert Aug 28, 2009
Inflationary expectations. have strengthened as the prices of a small number of commodities have gone up, while bank loans have risen and stock prices have rebounded, the commission said. (Taipei Times, Taiwan -- World Business)
Bernanke, the patch-it banker Aug 28, 2009
In our humble opinion, and our understanding of the facts, inflationary expectations, not the output gap, are what drives inflation ... From our perspective, the best way for a central bank to keep inflationary expectations low is through the pursuit of sound monetary policy; a policy that focuses on price stability ... While we understand why the Fed is talking - to manage inflationary expectations - we believe the Fed may be playing with fire at our expense. (Asia Times Online)
* Roubini sees double-dip recession risk Aug 25, 2009
Those who maintain large budget deficits will be punished by bond market vigilantes, as inflationary expectations and yields on long-term government bonds rise and borrowing costs climb sharply, he wrote. That will in turn lead to stagflation, Roubini said. (Taipei Times, Taiwan -- Sports)
Data suggest recession in the U.S. far from over Aug 18, 2009
At this point, inflationary expectations will increase, long-term government bond yields will rise, and the recovery will be crowded out. A second reason to fear a double-dip recession concerns the fact that oil, energy, and food prices may be rising faster than economic fundamentals warrant, and could be driven higher by the wall of liquidity-chasing assets, as well as by speculative demand. (Xinhuanet, China)
Bond prices dip; Re weaker by 13 p Aug 15, 2009
On Wednesday too, RBI auctioned 91-day and 364-day T-bills, with high cut-off yields indicating the inflationary expectations building in among traders. On Friday, RBI said it had set a cut-off yield of 7. (India Times)
'Too early to act on inflation' Aug 15, 2009
HYDERABAD: The Reserve Bank of India (RBI) will maintain a soft interest rate stance in the near term, even though poor rains could push up food-prices and fuel inflationary expectations ... The Reserve Bank of India (RBI) will maintain a soft interest rate stance in the near term, even though poor rains could push up food-prices and fuel inflationary expectations. (India Times)
Bonds trade steady; rupee down 37 p Aug 13, 2009
However, RBI auctioned 91-day and 364-day T bills on Wednesday, cut-off yields in both of them demonstrated the inflationary expectations building in among traders. While the shorter T-bill was sold at 3. (India Times)
Sacci poll finds trade conditions improving Aug 13, 2009
"Although there is a more positive outlook for most aspects of trade conditions six months ahead, inflationary expectations rose for the next six months as the indices on expected input and sales prices both increased," Sacci said. Sacci said employment prospects increased to 46 in July from 41 in June. (Business Report, South Africa)
Consumers' price-rise expectations heighten Aug 13, 2009
The Melbourne Institute survey of consumer inflationary expectations found the median expected inflation rate was 3. 5 per cent in August, up from 3. (Sydney Morning Herald -- Business)
* Another stimulus is crucial for the global economy Aug 12, 2009
Nevertheless, there is some concern that growing inflationary expectations might result in rising long-term interest rates, offsetting the benefits of the stimulus. Here, monetary authorities must be vigilant and continue their non-standard interventions X managing both short-term and long-term interest rates. (Taipei Times, Taiwan -- Sports)
Comment: Plan For All Seasons Aug 12, 2009
With lower acreage spiking inflationary expectations, already high food prices can soar. While price-fixing and export bans are standard responses, intelligent use of buffer stocks, imports and zero tolerance for black marketers will serve as better price stabilisers. (India Times, India)
Transcript of a Conference Call with IMF Senior staffs on the Launch of The State of Public Finances: A Cross-Country Fiscal Monitor Aug 2, 2009
There is some sort of pickup in inflationary expectations. But given the large and widening output gaps, the increase in bond yields for advanced countries essentially reflects a normalization of conditions. (IMF News)
Public Information Notice: IMF Executive Board Concludes Article IV Consultation with Brazil Jul 29, 2009
Inflationary expectations have remained well anchored, despite the significant depreciation of the currency and the fact that inflation was still close to the top of the target range in late 2008. Federal government revenues declined by close to 7 percent in real terms during January May 2009 compared with the same period in 2008. (IMF News)
Rate rise looms as economy recovers Jul 29, 2009
Mr Stevens said higher interest rates would be needed to rein in inflationary expectations as the economy recovered and also to ensure that strong demand for housing was translated into more dwellings, not just higher prices. Source. (Sydney Morning Herald -- Australia)
Argentine Farmers Expect Record Grain Harvests From Government Tax Cuts Jul 20, 2009
Event Date Budget Balance July 20 - July 24 Inflationary expectations July 20 Industrial Production July 24. To contact the reporter on this story: Eliana Raszewski in Buenos Aires at ; in Santiago at. (Bloomberg -- Latin America)
IMF approval of US597 is vote of confidence in economy Jul 17, 2009
Besides the inflows would also lead to higher financing of the budget from external sources, thereby reduce domestic borrowing by government and dampen inflationary expectations. "The result will be lower domestic interest rates," Dr Duffuor added. (Ghana Web, Ghana)
Trade conditions remain depressed, Sacci Jul 15, 2009
Sacci said: "There is a more positive outlook for most aspects of trade conditions six months hence. Inflationary expectations for the next six months (scope of survey) were lower and the indices on expected input and sales prices declined by 5 points and 1 point, respectively, in June.". Sacci said notwithstanding higher expectations on inflation in the May survey, inflationary expectations receded somewhat in last month's survey. (Business Report, South Africa)
Increase your exposure to debt funds Jul 14, 2009
If inflation goes up, then there will be an end to easing monetary policy soon rather we may see some proactive measures by the Reserve Bank of India to absorb excess money from the system to contain inflation and inflationary expectations. In short, interest rate cycle may turn northward soon. (India Times)
Obama Adviser: 2nd Stimulus Needed, Forget Inflation Jul 8, 2009
Turning to the Federal Reserve's near-zero rates policy and credit easing, Tyson said inflationary expectations remained "well-grounded", giving policymakers room to pursue these expansionary policies. She said she was also not worried about whether the Fed can exit such a policy. (Newsmax)
U.S. Should Plan 2nd Fiscal Stimulus: Economic Adviser Jul 7, 2009
Turning to the Federal Reserve's near-zero rates policy and credit easing, Tyson said inflationary expectations remained "well-grounded", giving policymakers room to pursue these expansionary policies. 1. (ABC News -- Wire)
Stable markets boost business confidence Jul 7, 2009
3 percent price increase for electricity would contribute to higher inflationary expectations and risks. The body urged caution and restraint in economic policies as South Africa struggles to pull itself out of recession. (Business Report, South Africa)
Gold Declines for First Day in Five as Dollar Stems Fall, Boosting Appeal Jun 29, 2009
Still, the metal is headed for a third straight quarterly increase on longer-term inflationary expectations. With a ballooning U.S. budget deficit there is an argument for higher gold prices in the medium term, although in the coming weeks, with the commodities sector somewhat strained, the price may remain under pressure, said Lasserre. (Bloomberg -- Australia & New Zealand)
Fiscal-Financial Nexus: The Challenges and Lessons of the Global Crisis, a speech by IMF First Deputy Managing Director John Lipsky Jun 27, 2009
Such a development if sustained eventually could deteriorate medium-term inflationary expectations while undermining the credibility of monetary policy. Moreover, these operations do not have an immediate impact on government debt, but they could need to be covered by governments if they lead to losses. (IMF News)
Deflation lives Jun 27, 2009
Mr Thomson says Japan failed to create inflation in the 1990s because inflationary expectations remained very low due to wage deflation caused by globalisation. Western economies, with the exception of Germany, largely escaped these pressures because heavy consumer borrowing and asset price inflation maintained wage growth. (FT.com -- Markets)
Transcript of a Press Conference on the U.S. Article IV Mission Review Jun 19, 2009
But, also, it will depend very much on inflationary expectations and communication ... That means that there is no obvious, fundamental source of near-term pressure on the Fed to act, but in terms of deciding when, where, and how to begin their exit strategy from monetary stimulus, will depend on the strength or growth both here and aboard will depend on the evolution of inflationary expectations, as Mr. Eyzaguirre said, so, it is not easy to reduce to a neat formula, but, again our guess is... (IMF News)
Which way mortgage rates? Jun 18, 2009
Inflation and inflationary expectations appear to be under control. Meanwhile, that U.S. mortgage applications fell for a fourth consecutive week, with overall demand plunging to its lowest level in nearly seven months. (Atlanta Journal-Constitution -- Business)
Revival brings back inflation fears Jun 17, 2009
5% from an earlier forecast of 3% by Goldman Sachs shows that inflationary expectations are beginning to build up again. An analysis of the week-on-week movement of items in the basket of the wholesale price index and the consumer price indices shows that the fall in prices had bottomed out by March this year. (India Times)
Long View: Surreal goings on in the commodities show Jun 16, 2009
Second, they create inflation, and help to drive inflationary expectations, as the chart shows. When the oil price bottomed, bond markets expected deflation of 6 per cent over the next two years; they now expect inflation once more. (FT.com -- Markets)
An exit for the central banks? This way out Jun 5, 2009
Some of this increase is indeed down to higher inflationary expectations. Inflation-protected bonds now imply future inflation of 2%, up from close to zero late last year, according to Barclays. (The Economist)
Transcript of a Press Conference Call by the International Monetary Fund on "Lending for Africa" Jun 4, 2009
We also support a modest loosening of monetary policies in the face of falling inflation and low inflationary expectations. So the IMF supports the fiscal and monetary stimulus in Tanzania; it supports it also with our financing, which will provide Tanzania with what we consider to be a comfortable cushion of foreign exchange reserves, remaining somewhat above four months of imports of goods and services. (IMF News)
Green shoots Jun 4, 2009
"One risk when you start to play with inflation is that you create expectations and if the inflationary expectations get out of hand, then you create some undesirable inflation, which becomes more difficult to control.". Prof Goodhart says that the problem with the strategy would be the rising cost of borrowing. (BBC News -- Business)
BOJ's Kamezaki Says Economy No Longer in Freefall, Predicts Mild Recovery Jun 3, 2009
Kamezaki said the policy board is watching the risk that declines in consumer prices will accelerate and erode inflationary expectations of companies and consumers. Receding expectations of price increases could lead to a deflationary spiral, which is very dangerous, the former Mitsubishi Corp. executive said. (Bloomberg -- Japan)
Consumer Prices Fall for Second Month Adding to Signs Deflation May Return May 29, 2009
Some central bank board members said that they should pay particular attention to the risk that inflationary expectations will decline over the long term, according to of their April 30 meeting. Economists say the drop in prices is worse than todays number showed. (Bloomberg -- Japan)
Monetary folly oils oil gains May 28, 2009
Furthermore, the deep-rooted inflationary expectations that are validated by previous and recent surges in oil prices would strengthen oil producers' strategy for freezing output. For some oil exporters that have excess capacity, higher output would only give them surplus dollars that will be loosing value through inflation and dollar depreciation. (Asia Times Online)
The Demise of the Dollar May 27, 2009
The Fed pumping money into the financial system will inevitably cause both inflationary expectations and yields to rise. With l ast week's rout in U.S. Treasuries -- the biggest since June 2008 -- Treasury Secretary Timothy Geithner was prompted to tell Congress that his "basic obligation" was to put in place policies that keep confidence "in our currency, (and)... a strong dollar." You have to wonder whether Geithner himself believes his own cant. (Human Events Online)
Oil, Metal May Make Comeback May 17, 2009
Bullion prices should rise vs. all currencies as the world's aggressive monetary policies increase inflationary expectations, Hummel says. That will boost the world's biggest gold miner, South Africa. (Investors Business Daily)
Press Release: IMF Executive Board Completes First Review Under Serbia's Stand-By Arrangement and Increases Financial Support to 2.9 Billion May 16, 2009
Given the still high inflation rate, the authorities will need to proceed with caution to keep inflationary expectations in check. The long-delayed structural reforms need to be tackled. (IMF News)
Gold investors wonder when to switch assets May 16, 2009
"If expectations that the economy is beginning to recover take root, we may see a shift in the forces driving gold trading away from safe-haven buying and towards inflationary expectations," said James Steel, a precious metals analyst at HSBC, in a note to clients. Only when central banks turn hawkish would the bears win the ground on gold, in his view: "Gold prices are unlikely to substantially retreat until investors are assured that the Federal Reserve and other central banks will be able and... (Business Report, South Africa)
Gold Heads for Fourth Weekly Decline on Inflation Outlook, Equities Rally Apr 17, 2009
Over the longer term however, unprecedented fiscal and monetary stimuli have increased inflationary expectations, which will be constructive to gold prices, said Hassall. Among other precious metals for immediate delivery, silver was down 0. (Bloomberg -- Australia & New Zealand)
Inflation expectations stay low Apr 9, 2009
"Notwithstanding the slight rise observed in April's median expected inflation rate, this is the fifth consecutive month that consumer inflationary expectations have remained within the Reserve Bank's 2% - 3% target band," said Sam Tsiaplias, a research fellow at the Melbourne Institute. "Median inflationary expectations in April are at 2.4% and significantly lower than the 4.5% observed for the equivalent period last year.". (Sydney Morning Herald -- Business)
G-20 makes it worse Apr 8, 2009
It contributes to deepening recession and strengthening inflationary expectations. The communique announced a world gold rush: "Today, we have further agreed over $1 trillion of additional resources for the world economy through our international financial institutions and trade finance.". (Asia Times Online)
Japan: The incredible shrinking economy Apr 3, 2009
The BOJ has also stepped up its purchases of government bonds, but after its experience in 2001-06, the bank remains sceptical that such quantitative easing can lift inflationary expectations and spur demand. One big difference is that the previous episode of quantitative easing coincided with stringent budget-tightening under Junichiro Koizumi, the then prime minister. (The Economist)
What's going on in U.S. economy will hurt Alaska Mar 29, 2009
Interest rates soar both because the Federal Reserve is pushing them up and because inflationary expectations remain counterproductive for at least six to 12 months. How likely is it that something like this ugly state of affairs will to come to pass. (Anchorage Daily News)
Inflation prospects hit decade-low Mar 12, 2009
The low inflationary expectations observed this month are consistent with the weak December quarter (gross domestic product) figure, and suggest that the potential inflationary effects of the Reserve Bank's easing in monetary policy, in the last seven months, have been extremely mild,'' said Sam Tsiaplias, a research fellow at the Melbourne Institute. A pullback in growth, flagged by the 0. (Sydney Morning Herald -- Business)
Switzerland: 2009 Article IV Consultation - Conclusions of the Mission Mar 10, 2009
With the economy starting to slow, inflationary expectations rapidly falling and the currency appreciating, the SNB moved forcefully, relaxing the monetary policy stance by 225 basis points over a period of about two months at the end of 2008. The policy rate is now near zero. (IMF News)
Yellen: Fed Got It Right, Inflation Moderate Feb 28, 2009
"My hope is that inflationary expectations will remain similarly well-anchored now, serving to stabilize core inflation.". Yellen is a voting member of the Federal Open Market Committee in 2009. (Newsmax)
A 25-Minute Work Week on Zimbabwe's Stock Exchange Feb 26, 2009
"There have been attempts to blame 'speculators' and 'rogue traders' for a sharp depreciation in the Zimbabwe dollar and rising inflationary expectations," says Shumba. Gono insists that he "had hardly printed money, yet the growth in the money supply was phenomenal," blaming stockbrokers for generating inflation. (Time.com)
Japan's Bonds Rise Most in Two Weeks After Better-Than-Expected Note Sale Feb 26, 2009
one of the eight BOJ policy board members, said in a speech today the central bank must closely watch inflationary expectations. Noda dissented from Governor s Dec. 19 proposal to lower the overnight interest rate to 0. (Bloomberg -- Japan)
January Consumer Prices Probably Fell, Signaling Deflation May Resurface Feb 26, 2009
We must carefully monitor how rapid price declines will influence inflationary expectations in the longer term, Noda said. fell at the fastest pace since the 1974 oil shock last quarter as exports collapsed. (Bloomberg -- Japan)
Gold lights up Obama errors Feb 25, 2009
As inflationary expectations were regaining momentum, the run-up in gold prices was a general flight from paper currencies ... Their rise was curtailed only when real interest rates became positive and inflationary expectations extricated ... The federal funds rate had to rise to 19% in 1981 in order to stabilize monetary conditions and uproot inflationary expectations. (Asia Times Online)
Suda Opposed Buying Corporate Debt in January, Bank of Japan Minutes Show Feb 24, 2009
Many members said a possible decline in inflationary expectations over the longer term requires careful monitoring as a risk for the economy. Governor has said policy makers need to pay attention to such expectations for signs of a deflationary spiral. (Bloomberg -- Japan)
Prime rate to remain unchanged Feb 23, 2009
In the past year, the MPC maintained a tight monetary policy stance to steer inflationary expectations towards the lower single-digit path. The MPC had increased the Prime Rate from 16. (Ghana Web, Ghana)
BoG breaks silence Feb 23, 2009
The delay in the Monetary Policy Committee (MPC) meetings, analysts have noted, had given way to widespread speculations about the countrys current fiscal and monetary standing, and inflationary expectations, for which reason banks continue to raise their lending rates indiscriminately. The hikes in borrowing rates, coupled with a constantly depreciating local currency are reported to be hitting local businesses hard, especially those with high import bills. (Ghana Web, Ghana)
In search of new BoG boss Feb 20, 2009
Even though prevailing high borrowing rates have often been cited as a shortfall for the outgoing team, the situation has been described by many as typical in an environment of high inflationary expectations, with the level of operational efficiency of the countrys banks also being a major factor. The new governor would have the major responsibility of ensuring that the countrys economy progresses from stability to growth. (Ghana Web, Ghana)
