Omicron risks new inflation headache for world's central bankers

The advent of the omicron variant of the coronavirus risks posing new challenges for central bankers by threatening economic growth while adding to inflation pressures.

The Bank of England in the City of London on Oct. 20, 2021. Foto: Bloomberg photo by Hollie Adams.

That's the initial analysis of economists, who warned that possible new restrictions on activity risk derailing plans to withdraw monetary stimulus while reinforcing the same imbalances that have fueled the current wave of surging consumer prices.

Omicron has hit the world just weeks away from key decisions by global central banks, with the Federal Reserve possibly accelerating a wind-down of its stimulus, the Bank of England potentially about to raise interest rates, and the European Central Bank plotting how to ease the euro zone off of emergency bond buying. They are preparing to respond to soaring inflation, which has reached a three decade high in the U.S., the highest in the eurozone's history and a 10 year record in the U.K...

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