Global Inflation Fears Continue To Chill Markets FINAL Edition

The worries yesterday erupted early in New Zealand, where the inflation-wary central bank boosted interest rates to 8 percent. New Zealand's action came on the heels of a rate increase by the European Central Bank on Wednesday. "Now you have full employment, less increases in productivity...

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Bibliographic Details
Published inThe Washington post
Main Authors Tomoeh Murakami Tse, Xiyun Yang - Washington Post Staff Writer
Format Newspaper Article
LanguageEnglish
Published Washington, D.C WP Company LLC d/b/a The Washington Post 08.06.2007
Subjects
Dow Jones averages
Global economy
Inflation
NASDAQ trading
Securities markets
United States
US
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Summary:The worries yesterday erupted early in New Zealand, where the inflation-wary central bank boosted interest rates to 8 percent. New Zealand's action came on the heels of a rate increase by the European Central Bank on Wednesday. "Now you have full employment, less increases in productivity -- that's a combination for higher inflation down the road," said Joseph Quinlan, chief market strategist for Bank of America. "There's a whiff of inflation in the air driving interest rates higher." David Dreman of Dreman Value Management said he thinks an 8 to 10 percent correction in the coming months is probable, largely because the market had climbed so far so fast. But he noted that corporate balance sheets are strong and stock prices are at reasonable levels. "It's not an end-of-the-world scenario," Dreman said.
ISSN:0190-8286