The Bank of England economists expect much of Europe’s inflation rate to climb well above their usual comfort zone of 2%.

In light of these inflationary pressures, European monetary policies will likely resume increasing short-term interest rates. That will cause the US dollar to continue it’s decline.

If the dollar continues to fall the Fed and with the stealth inflation, witnessed by food prices out of control, is rampant in the U.S., then sometime in the future, the Fed will have to raise rates. It is either that or intervene in the European markets.

Either one of these reactions will have severe business implications. There may be an impending stock market danger ahead.