The Week In Perspective
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It was week dominated by central banks with the ECB hiking by 50bps and the SARB 75bps.
As Brian Kantor opined in Business Day this week, the best reason to expect inflation to subside in the US, Europe and South Africa is that the demands for goods and many services are already well depressed, thanks to higher prices. Spending is no longer being supported by additional income subsidies or by rapid growth in the money supply and bank credit. The money supply in the US (M2) has ground to a halt. The essential question is still to be answered. Is the US and Europe heading for recession aided and abetted by central banks intent on raising interest rates too aggressively and indeed unnecessarily fighting the last war?
Central banks should know better than to lead their economies into recession while inflation is moving in the right direction and their economies head in the wrong direction.
Joining Michael Avery to wrap up the week is Warwick Lucas, Head: Galileo Securities; Isaah Mhlanga, Chief Economist: Alexforbes and Raymond Parsons, Professor: School of Business and Governance at Northwest University
As Brian Kantor opined in Business Day this week, the best reason to expect inflation to subside in the US, Europe and South Africa is that the demands for goods and many services are already well depressed, thanks to higher prices. Spending is no longer being supported by additional income subsidies or by rapid growth in the money supply and bank credit. The money supply in the US (M2) has ground to a halt. The essential question is still to be answered. Is the US and Europe heading for recession aided and abetted by central banks intent on raising interest rates too aggressively and indeed unnecessarily fighting the last war?
Central banks should know better than to lead their economies into recession while inflation is moving in the right direction and their economies head in the wrong direction.
Joining Michael Avery to wrap up the week is Warwick Lucas, Head: Galileo Securities; Isaah Mhlanga, Chief Economist: Alexforbes and Raymond Parsons, Professor: School of Business and Governance at Northwest University
