BLOG: Optimism on reflation rebuffed by capacity utilisation rates

LONDON (ICIS)–Click here to see the latest blog post on Chemicals & The Economy by Paul Hodges, which looks at how reflation – increasing inflation caused by central banks’ monetary stimulus – is bringing optimism among policymakers, who are however forgetting to look at capacity utilisation rates (CU%) in the chemical industry and how they remain well-below the average.

“The CU% has an 88% correlation with actual GDP growth, far better than any IMF [International Monetary Fund] or central bank forecast,” says the author.

Editor’s note: This blog post is an opinion piece. The views expressed are those of the author and do not necessarily represent those of ICIS. Paul Hodges is the chairman of consultants International eChem.