25th February 2022 - Bailey warns of real risk of inflation

"The task facing the Bank of England and other Central Banks has been made much harder by Russia’s invasion of Ukraine. If the conflict in Eastern Europe continues for a period of months, the effect on the global economy could be catastrophic. As Russian tanks crossed into Ukraine yesterday, the price of a barrel of oil rose above $100 for the first time in seven years and the wholesale price of gas, which has already quadrupled in little over a year, rose by 60%. With inflation in the UK already at 5.4% and rising. Just as the country is emerging from the Coronavirus Pandemic, another major situation has now arisen. A further significant rise in the cost of energy will no doubt push inflation even higher than had been predicted, while if the oil price remains above $100, it will hit global growth hard. The World Bank had already predicted that global growth in 2022 would be 4.1%. This was down from its earlier prediction in October of last year of 5.5%. There is little doubt that it will be revised lower again when the data is updated at the end of next month. " Beyond Currency Market Commentary: Aims to provide deep insights into the political and economic events worldwide that can cause currencies to change and how this can affect your FX Exposure.