September Inflation Tracker: Still Broadening Out, But Starting To Peak

• As of September 14, global inflation came in at 4.1% y-o-y in August according to Fitch Solutions estimates, and while it edged slightly higher from July, the agency believes that most of the increase is behind us. 
• Although it remains elevated by historic standards, and well above central bank targets, they believe that inflation is closer to peaking, and expect to see price pressures abate in Q421. 
• Inflation has continued to broaden out, and has remained stickier to the upside, due to a combination of persistent supply chain issues and above-trend growth. 
• Fitch believes that inflation in Europe will continue to edge higher over the remainder of 2021 given that inflation troughed in the fourth quarter of 2020, which means that base effects will continue to flatter the numbers over the coming months. Inflation will also be supported by a continued pick-up in demand as the economic recovery in Europe broadens.

(Source: Fitch Solutions)