Even till just a few days ago the route for markets seemed clear. Inflation was under control nearly everywhere that matters, even if the Fed was making noises suggesting otherwise. That was just the US central bank chief Jay Powell making sure we didn’t get ahead of ourselves.
In the UK, May inflation figures would come in at 2% or lower, City economists were sure, setting the scene for rate cuts that would take borrowing costs from 5.25% at present to 4% by Christmas.
