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Biden's spending plans stoke worries over an inflationary surge

Conall Mac Coille


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Hey big spender — President Joe Biden wants to inject another $1.9trn into the US economy in the battle against the coronavirus recession

Hey big spender — President Joe Biden wants to inject another $1.9trn into the US economy in the battle against the coronavirus recession

Hey big spender — President Joe Biden wants to inject another $1.9trn into the US economy in the battle against the coronavirus recession

Since the beginning of 2021 fears have grown that inflation, which has remained muted since the global financial crisis in 2008, is finally on its way back. US 10-year break-even inflation expectations, derived from Treasury yields, have now risen to 2.3pc - their highest level since 2014 - signalling bond investors are increasingly worried about price pressures.

Over the past decade there have been many accusations that Central Bank policies such as quantitative easing would lead to rampant inflation, often argued in slightly hysterical terms, and describing printing money as 'debasing' the currency. Suffice to say, these warnings have failed to come to fruition, with CPI inflation remaining at muted levels across the OECD over the past decade


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