Sunday 27 February 2011

A pitfall of accelerating inflation

There is no doubt regarding surge global demands in the near future. Thus, while production of food and raw materials rise in the slower pace we will steadily feel higher pressure of growing inflation. Additionally to the constant increase in demands, political battles to boost domestic economies encourage unsustainable decisions. As long as currently accelerating inflation diminishes purchasing power of currencies and value of financial assets, the real global systematic risk arise which is a pitfall for economy growth and financial stability.

However, while somebody concerns about sustainability of economy and measures to keep financial stability, for others - political turmoil, high volatility in the financial markets and increased money supply to maintain liquidity are essential conditions to trade options successfully.

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