The Reflationary Turn

The global economy is tilting back towards reflation: growth is firming while inflation proves stubborn, just as a cluster of central banks prepare to meet.

This week in six charts:

→ Global growth surprises have lately been positive and inflation surprises negative — a supportive mix for equities.→ Policy uncertainty has eased, but remains high.→ Most major economies now sit on the reflationary side of the cycle.→ Supply-chain pressure is building again, pointing to firmer producer prices.→ The Phillips curve has re-steepened across advanced economies.→ The climb in bond yields is being driven by real rates, not inflation expectations.