TRANSLATION PRACTICE

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1.  INTRODUCTION

1.1.        BACKGROUND

Asia is growing fast, but risks drowning in inflation.Prices are rising at their fastest pace since the inflation explosion of 2008, and threaten a wage - price decrease. Without action, the hit from inflation will cut short Asia’s impressive recovery.

Monetary policy no longer works. Raising interest rates simply draws in more capital, leaving financial conditions highly stimulative.

Regulatory tightening is difficult to calibrate and best serves as a complementary tool to tackle inflation. In short, the hands of central bankers are tied.

Officials across the region have shored up price controls and subsidies to cushion the blow. These measures are costly and do not address the underlying issues.

Farmers will not grow more if their prices are controlled, and car owners will continue driving unless the cost of petrol rises. Growth will also move ahead unimpeded, eventually sparking a broader rise in prices.

Nguyen Thu Ha – ETE 27