Macroeconomic challenges are mounting for chief executives 

As inflation dynamics oscillate, business leaders must prepare for more bumps in the road ahead.

Macroeconomic challenges are mounting for chief executives around the globe, from inflation and wage pressures to higher borrowing costs and riskier sovereign debt burdens. While business leaders should be thinking about the appropriate response, such as pre-emptive price rises, even if not yet justified by cost pressures, they should also look beyond the present and reflect on what could come next: making predictions in turbulent times can inform long-term strategy and present-day decisions. 

For one, I believe that inflation is not going to be the purely transitory factor that many economists anticipated initially. First, supply shortages in the face of COVID-19 restrictions, and the observed change in the composition of demand towards goods and away from services, are not likely to disappear instantaneously; second, recent price developments are bound to have some…