CommBank warns higher neutral rates keep inflation fight driving structurally higher borrowing costs - TLT News | RalliesCommBank warns higher neutral rates keep inflation fight driving structurally higher borrowing costs
T
TLT• CommBank flags a shift to a new economic reality
- Commonwealth Bank of Australia flagged a shift to a “new economic reality,” citing stubborn inflation and rising longer-term borrowing costs globally.
- It expects structurally higher inflation to lift neutral interest rates, implying policy rates stay higher than in the past to contain prices.
- Greater uncertainty around neutral-rate estimates increases reliance on real-time data, raising the risk of central-bank policy errors.
- Bond markets are described as more skittish, pressuring central banks to act decisively or risk credibility losses.
•
