Deflation

DEMOGRAPHICS

Central bankers risk creating an "inflationary overshoot" because of their attempts to avoid deflation, the managers of the Ruffer Investment Company have warned.

Mario Draghi, the head of the European Central Bank (ECB), has said the country is not facing a Japanese-style deflationary spiral despite recent data showing inflation is sliding.

Economist and renowned commentator on Japan, Arcus Investment's Peter Tasker, said in the last 20 years the country has been through the most severe and prolonged bear market ever seen.

SHOULD YOU BE WORRIED ABOUT INFLATION?

The latest round of QE from the US Federal Reserve may not be enough to prevent the global economy from experiencing a deflationary episode, according to Sebastian Lyon, manager of the £2.2bn Troy Trojan fund.

DEFLATION

The coalition government's emergency budget and harsh spending cuts risk driving the UK economy back into recession, warns veteran hedge fund manager George Soros.

THE BIG QUESTION

Bill Gross' Pimco, the world's largest bond manager, has made a $8.1bn bet the US will not suffer a decade of deflation similar to Japan in the 1990s.