Good Inflation News in Short Supply
by AIB Treasury Economic Research Unit
- Recent inflation data have been disappointing, especially in regard to core measures
- The downtrend in headline inflation will resume in the months ahead on base effects as the surge in energy prices last year following the Russian invasion of Ukraine drops out of annual rates.
- The first relates to the tightness of labour markets, with unemployment rates at multi-decade lows amid sluggish growth in labour forces in the US and UK.
- The second factor relates to ongoing deficiencies in the supply side of economies.
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