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Caution prevails: CPI to moderate in 2021; Space remains for 25bp Cut on Disinflation

CBR
  • CBR TO WEIGH POSSIBILITY OF FURTHER CUTS
  • INFLATION 4.7% AS OF DEC. 14
  • 1-OFF PROINFLATIONARY FACTORS MORE SIGNIFICANT
  • DISINFLATIONARY RISKS LESS PREVALENT IN 2021 (2h21 expected to moderate on output and consumption gap)
  • CPI SIGNIFICANTLY IMPACTED BY FISCAL POLICY
  • INFLATION TO SLOW DOWN TO 3.5%-4.0% IN 2021
  • SEES PAUSE IN ECONOMIC RECOVERY IN 4Q - recent data supporting a slowdown (retail sales etc)
MNI London Bureau | +44 020-3983-7894 | murray.nichol@marketnews.com
MNI London Bureau | +44 020-3983-7894 | murray.nichol@marketnews.com

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