ARE WE SEEING THE FIRST SIGNS OF a RETURN TO INFLATION?

Simon Baptist, Chief Economist for the Economist Intelligence Unit raises the question whether we are seeing  first signs of a return to inflation  in a Twitter posting on @baptist_simon  with a link to his current Newsletter headlined The Return of Inflation where he writes:

…”1 Chinese Factory Gate prices ended their near five year run of declines, while in the UK producer price inflation reached a five year high of 1.2%. In bad news for UK firms producer input prices rose by an astonishing 7.2% implying a huge compression in average profit margins – and significant consumer price inflation (or bankruptcies) to come.”