Inflation warnings are mostly ‘just in case’ : Mike Dolan

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(The author is editor-at-large for finance and markets at Reuters News. Any views expressed here are his own) LONDON- As grandees of the investment world fall over themselves to warn of long-absent inflation up ahead, financial markets appear ever calmer about the risks of that new regime unfolding. Is the post-pandemic inflation scare over already Thursday will likely see the United States record the highest consumer price inflation rate in 13 years – just shy of 5% – and the fastest rate since 1993 if food and energy prices are cut out.

Yet, bond and stock markets have been buoyant for weeks – seemingly comfortable with Federal Reserve signalling this is temporary and possibly even marking a peak of distorted ‘base effects’ measured against price falls as the pandemic hit a year ago. The past 12 months of COVID-related disruption has led to supply bottlenecks and jobs market distortions that may persist a little longer, but policymakers reckon these more...