Kokou Agbo-Bloua, global head of economics, cross-asset and quant research at Societe Generale Corporate and Investment Banking, discusses central banks’ monetary policy tightening efforts and their potential impact on the economic and market outlook.
You know, this might be a crazy idea, but inflation is driven by supply vs demand, right?
Too much money in the economy definitely drives up inflation, because supply can’t keep up on a normal day, but this isn’t a normal day. Supply is way down, especially oil supply being down because of the war in Ukraine.
And oil being more expensive makes everything more expensive. Even agricultural, because tractors on the farms use oil, all the way to the trucks getting that produce to the store uses oil.