Fed Governor Brainard said the central bank could raise its benchmark interest rate as early as March to ensure the worst inflationary pressures in decades are contained. "The FOMC is already projecting several rate hikes this year, and I think once the asset purchases are over, we'll be well," Brainard said Thursday at the Senate Banking Committee's confirmation hearing on his nomination for vice chair. Preparations for action. Of course we also have to keep an eye on the economic data that will be released for the rest of the year.” The Fed's bond purchases are scheduled to end in mid-March. Brainard's determination to fight inflation marks a major shift in the views of the key Fed dove, who said last July that inflation could return to a pattern that has been below the 2 percent target for years.

U.S. producer price increases slowed in December as the cost of energy and food, two key drivers of a surge in inflation in 2021, eased month-on-month, suggesting price pressures may be starting to ease. The U.S. Labor Department data released on Thursday showed that the producer price index for final demand (PPI) rose 0.2% in December from a month earlier, after an upwardly revised 1% rise in November. The PPI rose 9.7% from a year earlier, the second-biggest rise since 2010. The median forecast of economists surveyed by Bloomberg was for the data to rise 0.4% month-on-month and 9.8% year-on-year. Excluding the volatile food and energy components, PPI rose 0.5% month-on-month in December. The year-on-year increase was 8.3%, higher than economists expected. The December data reflected lower gasoline and food prices. Service prices rose month-on-month, but at a moderate rate. The figures suggest that the rapid rise in inflation will moderate after a shortage of raw materials, limited labor supplies and transportation bottlenecks caused prices to soar last year.

U.S. initial jobless claims rose unexpectedly for a second straight week last week to their highest level in two months, signaling that a recent surge in coronavirus cases could lead to higher job losses. Initial jobless claims totaled 230,000 for the week ended Jan. 8, up 23,000 from the previous week, data from the Labor Department showed on Thursday. Economists polled by Bloomberg had expected a median of 200,000.

"Inflation will certainly fall, but the question or main risk to the short-term inflation outlook will be the evolution of energy prices," ECB Deputy President Luis de Guindos told a virtual event hosted by UBS. Very specific, very special circumstances". The supply side issues "will be resolved sooner or later" and will not continue to have the same impact as in 2021. Second-round effects in response to a temporary rise in inflation should be avoided. Salary pressure has been low so far.

South Korea's central bank may consider raising interest rates again this week to keep inflation under control and prevent turbulence in capital flows as the Fed prepares a series of rate hikes. Two-thirds of 18 economists polled by Bloomberg expect the Bank of Korea to raise interest rates by 25 basis points to 1.25 percent on Friday, the third hike since the central bank launched its exit from coronavirus stimulus. Given the outbreak caused by the omicron variant of the new coronavirus and restrictions to prevent it, it may give the bank a reason to wait longer and avoid a rare two consecutive rate hikes.

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