As oil prices affect inflation?

The greatest interest among investors for the nearest time will occupy Iraqi theme, because of oil. Importance of news from the region is quite high because of the situation will depend on the movement of market, and oil prices from a global perspective.

Price risks in the oil returned to the markets, and generate other risks already. These new risks related to the issue of inflation. At the moment, it is very complicated work of global central banks, which already began to implement multidirectional policy. Europe tends to mitigate and achieve the planned level of inflation, and the U.S. plans to tighten monetary policy. Developed countries that are net importers of oil, exposed major price oil shock since the global crisis. There is speculation that it is quite possible increase in oil prices by 15%.

For Europe, this jump can be considered a gift, because it is low energy prices were a major cause of the rise of deflationary risks. The IMF believes that the ECB is still not a reason to abandon the recent measures, although it is likely that these measures will be needed later, experts TeleTrade. As for the U.S., the rise in oil prices may be more painful as push inflation above the level of 2%, and the Fed may need to raise rates ahead of schedule. This increase, in turn, is a pretty serious threat to economic growth.

As oil prices affect inflation?