I heard a common theme in my recent encounters with clients and central bank officials in Frankfurt, London, Beijing, Tokyo, Auckland, Wellington and Berkeley. Despite very different cyclical conditions and growth trajectories, central bankers everywhere generally think inflation is too low for comfort. Still, near-term policy paths are likely to diverge. European Central Bank: The ECB expects eurozone inflation will return to 2% only very slowly, no matter what exact policy actions they take in December. There is a sort of “pent-up price deflation” in the eurozone to follow the trend in wage deflation, which we ... (full story)