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Opinion
Stuart Trow and Marcus Ashworth

Welcome to the Scary, New Inflationary World

With the end the Great Moderation, policymakers will struggle to contain violent price swings. 

Stars of a bygone era of central banking.

Stars of a bygone era of central banking.

Photographer: Diana Walker/The Chronicle Collection

The world looked on in horror last week as the UK’s market collapse prompted the Bank of England to reverse its plans for quantitative tightening with a spectacular intervention in the gilt market — “on whatever scale is necessary” — to save the nation’s pensions system.

So far, this appears to be a uniquely British debacle. But what if the UK isn’t an outlier and, by dint of Chancellor of the Exchequer Kwasi Kwarteng’s ill-fated dash for growth, is instead merely the first to reflect a new global reality?