World may be on brink of new inflationary era, says central bank chief

Global inflation outlook contrasts with Bank of England, which estimates inflation will fall next year

The world economy may be on the brink of a new inflationary era with persistently higher growth in consumer prices due to the retreat of globalisation, a leading central bank chief has said.

Agustin Carstens, head of the Basel-based Bank for International Settlements - which is known as the central bank of central banks - said there was a strong risk that prices would rise uncontrollably without a sharp rise in interest rates above existing plans.