Reported with AI assistance from public sources. Every claim names its outlet in the text and is listed with its source below. An editor pass and fact-check ran before publication. — Align Newsroom, part of Creytix.
Here is the trap central banks keep walking into: when inflation does the slowing, cutting rates to revive growth only feeds the thing that is slowing it .
I look at the Philippines and see the trap in miniature. Growth slowed further, to 2.1% in the third quarter, and the drag was high inflation, Nikkei Asia reported . That is not a demand problem. Demand problems are fixed with cheaper money. An inflation problem is made worse by it.
Britain's central bank just raised its key rate for the first time in over three years . The Fed held rates days before the US midterms while two of its officials pushed for another hike . Italy's inflation surged to 5.4% in October as energy costs bit . Everywhere, the same bind: prices rising, growth slowing, and no clean lever to pull.
Markets, meanwhile, are whipsawing on the same confusion. Nvidia and SpaceX lost billions in market value as tech and AI stocks plummeted , then AI stocks climbed after trillions had been wiped from market values . Morgan Stanley warned China stocks could slide 15% before bottoming . The market cannot decide whether the story is a crash or a buying opportunity, because the underlying story — inflation dragging real growth — has no quick ending.
My view is that the Philippines number matters more than the market noise. A 2.1% growth rate dragged by inflation is what a stagflation scare looks like before anyone calls it that .
Prediction: Philippine GDP growth will come in below 3% again in the fourth quarter of 2026, with inflation still cited as the drag [check: 2027-02-28].
Sources
- Nikkei Asia Single source
- Euronews Single source
- BBC News — World Single source
- South China Morning Post Single source
Single source means the only outlet cited for at least one claim in this article.