Renewed yen weakness could bring about a fresh global currency war resulting in a 'tidal wave of deflation' in China and the West, Société Générale's Albert Edwards has warned.
The Office for National Statistics this morning revealed UK CPI inflation turned negative for the first time on record, but key industry figures suggest this deflationary spell will be temporary.
UK CPI inflation has turned negative for the first time on record, as the recent slump in the oil price continues to put deflationary pressures on the UK economy.
PIMCO’s CIO Mihir Worah has labelled shorting UK RPI 'the carry trade of the decade', as he sees inflation in the UK remaining below current expectations.
Inflation: The elephant in the room
Sterling has fallen after the Bank of England downgraded its growth forecasts for the UK economy while indicating it could start to raise interest rates in mid-2016.
The return of inflation
Equity markets have begun to recover after an early slump driven by a plunge in German sovereign debt prices.
The Bank of England's Monetary Policy Committee has become less concerned with deflation risks, according to it latest minutes, despite CPI inflation dropping to 0%.
The UK economy is set to grow 2.8% this year, helped by CPI at zero and a lower oil price, according to the EY Item Club.
Central banks may resort to 'helicopter drop' measures to stave off the threat of deflation, according to Investec's Alastair Mundy.
The UK's headline inflation rate avoided negative territory in March but core inflation saw a surprise drop to its lowest level in nine years, latest figures show.
UK economic growth in the fourth quarter of last year was stronger than previously thought, according to the latest estimate from the Office for National Statistics (ONS).
Escaping the debt trap
As inflation in the UK hits zero for the first time on record, industry experts share their views on what this means for the UK economy and investors.
UK Consumer Prices Index (CPI) inflation continued its precipitous fall in February, dropping more than expected to hit zero for the first time.
Lower inflation, driven by a fall in oil prices, has helped the Office for Budget Responsibility (OBR) upgrade UK growth forecasts for 2015 and 2016 and given the government room to move on near-term borrowing.
Which way will the economy go?
Mark Carney has told MPs it would be ‘extremely foolish’ for the Bank of England to cut interest rates further in order to combat falling inflation.
Xavier Hovasse, manager of Carmignac’s Emerging Discovery fund, takes a closer look at opportunities for investors in China and India.
Monetary Policy Committee members voted unanimously to keep interest rates in hold this month, but potential divisions over the future path of rates have begun to emerge once more.
Inflation fell to 0.3% in January, the lowest level ever recorded, as price growth continued to slump on the back of falling oil prices.
M&G's head of retail fixed interest Jim Leaviss has said it may be time to invest in US inflation protection following the oil-related sell-off seen in recent months.
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