JPM's Gartside predicts 15% chance of stagflation

J.P. Morgan's Nick Gartside has revised his economic outlook to include a 15% chance of stagflation, as the UK posts 4.4% inflation for February.

The head of fixed income, who joined JPM from Schroders in September last year, says he has believed for some time UK inflation would surprise on the upside. "This is because, firstly, the inflation in the UK is externally generated so it is higher food and fuel prices. Secondly, broadly, sterling has been weak. Thirdly, inflation expectations are high now in the UK, and inflation is a self-fulfilling prophecy - if you think something will become more expensive, you go out and buy it now. The VAT rise has also impacted today's inflation number," he says. "At the start of the year we t...