• Inflation fears continue to raise concerns of tapering in the quantitative easing policy of major central banks
  
• The United Kingdom’s (UK) economic activity continues to trot as evident from monthly gross domestic product data
  
• Energy and non-energy price indices rise sharply on-month
  

With economic growth making a comeback, can inflation be far behind? Higher vaccination coverage and stimulus measures, particularly in advanced economies, are fueling a long-anticipated economic recovery. However, inflation has also been inching upwards on-year in the United States (US), Europe and China since the startof 2021. The rising prices are leading to fears over whether major central banks would roll back their bond purchases to avoid overheating.

However, these fears could be overstated, as central banks in both the US and Europe have outlined that price rises may be transitory owing to the low base of 2020 and the commodity cycle in the current year.