The curse of inflation
Reducing approximation errors in LPI swaps
Current issuance of inflation-linked bonds is too meagre to meet demand from domestic and international investors, say market participants
Correlation between inflation and real estate investment can be negative in the short term but almost perfect on a long-term time horizon
QE2 will spur above target inflation in 2011 and low real yields mean pension funds should look to shares
Time for change
Returns as important as risk management, say M&G Investments
Commentators praise the innovation underlying Google price index; despite limitations, index could work as a CPI subset
Chief strategist at CreditSights Louise Purtle warns that global deleveraging makes double-dip recession more likely than inflation.
UK’s PPF is open to longevity derisking – at the right price
Best of RPI and CPI exposure will cost up to 100 basis points to hedge, as well as increase the size of liabilities, say participants
Limited impact of CPI change on pension funds inflation hedging
Using CPI instead of RPI was intended to save money - but could end up costing UK pension funds billions
Inflation often accompanies the end of the recovery after a crisis, but while US companies may fear high inflation, banks and investors increasingly see deflation as the more serious risk to the US economy.
Bank for International Settlements says degree of slack likely to be smaller than suggested by output gap models
Hedge funds seeking protection against deflation and dealer hedging of residual short floor positions are cited as the reasons for a rise in prices on euro zero-coupon inflation options.
A roundtable on inflation and inflation derivatives hosted by Risk magazine editor Nick Sawyer.