Risk of ‘wrathful Old Testament–model’ response from central banks is rising, JPMorgan says

The “gentle and forgiving path” taken by developed-market central banks to rein in inflation over the previous yr is prone to show unsuccessful and set off the necessity for extra forceful, biblical-type motion.That’s the view of economists Bruce Kasman, Joseph Lupton and Michael Hanson of JPMorgan Chase & Co. JPM, who described the response of central bankers previously yr as embodying “a New Testament–style grace” — when it comes to conserving the financial growth going and tolerating a gradual decline in inflation. Rate hikes to date have been “a correction from inappropriately accommodative stances reasonably than an try to…