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2026-07-15 19:14:11
[Standard Chartered Strategist Warns of Structural High Inflation Dilemma: Central Bank Policy Buffer Thinning, Supply Shocks Added to the Challenge] ⑴ A Standard Chartered chief strategist points out that global central banks need to acknowledge the current environment of structural high inflation, where the operational space and flexibility of monetary policymakers have significantly narrowed compared to the past. ⑵ Against this backdrop, central banks' ability to buffer against various supply shocks has been greatly weakened. Once multiple external disturbances overlap, policy maneuverability will be further compressed. ⑶ He cites an example: if global inflation is only at a low level of 1%, the impact of weather shocks such as El Niño might be easily absorbed; however, when countries are generally struggling to keep inflation below 3%, the combined effect of supply shocks in the oil and food sectors will significantly amplify upward pressure on prices. ⑷ This poses a deep challenge for central banks—interest rate hikes cannot increase the circulation supply of wheat, nor can they alleviate the substantial disruption of agricultural product supply caused by weather factors; traditional monetary policy tools have limited effectiveness in the face of supply-side shocks. (5) Structural high inflation means that central banks must make a more difficult trade-off between curbing demand and tolerating supply-side pressures, and the uncertainty of future policy paths will increase significantly.
