Global Data Pod: Inflation Monitor: Another squeeze, with broader pressures

A second global inflation squeeze is currently underway, marked by a sharp 0.6% month-on-month headline gain in September and core inflation momentum rising to 3.3%. This broadening impulse stems from supply chain pressures, increased freight rates, and tech-sector price hikes, while services inflation remains stubbornly elevated. Simultaneously, a historic El Niño event threatens to intensify food inflation, particularly in emerging markets, with potential spillover effects into early 2027. Although recent volatility in energy prices offers a potential offset, the persistence of core price pressures challenges the expectation of near-term disinflation. Consequently, central banks are maintaining a cautious stance, favoring a gradual hiking cycle as they navigate the uncertainty between supply-driven shocks and the risk of inflation becoming embedded in long-term expectations.