As we've reported, lip service aside, U.S. central bankers (as a voting majority) have zero desire -- or room, frankly -- to tighten monetary conditions for far into the foreseeable future.
Well, it appears -- at least from a desire standpoint -- the same can be said for much of the rest of the developing world. Certainly the bank of England.
Here's from the horse's mouth (courtesy of Bespoke Investment Group) this morning:
“...until there is clear evidence of progress towards [our] goals” for the UK economy; it would be “wrong” to “undermine the recovery with premature tightening” and the MPC is comfortable allowing inflation “to exceed 3% for a temporary period”
As for some emerging nation' policymakers, on the other hand, there appears to be a willingness to actually conduct themselves like responsible central bankers, believe it or not. One example comes from Chile, whose minutes (released today) from their latest central bank meeting says they're seriously considering a rate hike.
The latter, while recognizing inflation risks, also, I'm thinking -- intentionally or otherwise -- serves to quell the elephant-in-the-room risk we continue to harp on herein; which is the mammoth pile of US dollar-denominated debt sitting on emerging market corporate balance sheets. I.e., a stronger local currency (helped higher by higher local interest rates) -- read weaker dollar (read inflation) -- will serve to alleviate the pressure of those interest and principal payments going forward.
Here's the 3-day chart of the dollar in Chilean Peso terms:
“Successful investing is having everyone agree with you………..later."