The spectre of stagflation: real or imagined?

This monthly commentary gives a round-up of global markets and trends.

In this edition:

• Surging energy prices have contributed to inflationary pressures at a time when economic growth momentum may be weakening.
• This has led to concerns over potential stagflation, where inflation pushes prices up faster than wages and profits, forcing consumers and businesses to cut back on expenditure.
• Previous episodes of stagflation have been difficult for stock markets, with companies struggling to grow earnings.
• Stagflation remains only an outside possibility. Strong economic growth is allowing firms to pass on higher input costs to consumers without denting demand.

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