Inflation Would Be Good for Europe

The expectation of falling prices can lead to stagnant consumption and weak economic growth, which can put further downward pressure on prices - like in Japan

Coutts 14 July, 2014 | 3:01PM
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This article is part of Morningstar's "Perspectives" series, written by third-party contributors. Here, Alan Higgins, Chief Investment Officer, UK at Coutts gives his market outlook for the week.

Looking across the developed world from the perspective of inflation also highlights the likelihood of continued stimulus in Europe.

Japan may be growing out of the deflation mantle, and Europe is now striving not to take it up. Switzerland and Sweden continue to flirt with deflation, while eurozone inflation remained very low at 0.5% in June.

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