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Reflections #11 - No room for dovishness

With a heavy central bank meeting week ahead of us, the chances of a dovish surprise are rather slim. In fact, central banks have every reason to remain hawkish as inflation remains stubborn and lagged effects will still come to the fore in the months to come. No doubt cyclical inflation components are normalizing and base effects will do its job but inflation inertia remains the key risk for policy makers.


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