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  • Writer's pictureEdward Ballsdon

Are Central banks causing inflation....?

Research Content

Following the deep dive into US PCE inflation, as well as into the Canadian and Australian economies, it is clear that tighter monetary policy is linked to housing rental inflation.

This research presents a "True Core" inflation rate for the US, UK, Australia and Canada. This rate strips out those items whose changes in price are not necessarily linked to excessive consumer demand but instead to

  • government fiscal policy (e.g. sin taxes, income taxes etc)

  • central bank monetary policy (e.g. mortgage rates, housing rental costs)

  • weather, war, strikes etc (e.g. food, energy) which mean revert over time.

The results throw up some uncomfortable data for Central Banks given their current policy and statements.

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