During the 3Q 2021 earnings calls, many companies raised a ‘red flag’ for inflation. An industry study by Bank of America Global Research assessed the number of times ‘inflation’ was mentioned by European businesses on these calls.
The extremely sharp 350% rise over a 12-month period was in stark contrast to the previous decade. For some companies, surging labour and material costs could squeeze their profits and leave them struggling to grow.
Investors are now asking: how soon, and – more importantly – how high, will central banks hike rates in order to avoid a hot economy? Looking forward, are companies in for a bout of trouble?
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