And then there is the renewed threat of stagflation

The threat of global contagion from the troubled Chinese property developer Evergrande is far from negligible. For good measure the ebb and flow of news on the pandemic continues to be alarmingly unpredictable. And then there is the renewed threat of stagflation.

Power outages, supply chain disruption, shortages in the shops, soaring energy prices, labour shortages, accumulating debt — the bad news piles up.

The difficulty amid all these uncertainties is to understand precisely where we are in a cycle that has been hijacked by Covid-19... What is confusing now is that inflationary pressure is arising much earlier than usual in an upturn.

John Plender FT 7 October 2021


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