The latter was the factor that caused havoc last year when sterling strengthened and twentysomethings in Australia and Russia found their dresses became 20% dearer.
That would slow, but hardly fell, an economy that is widely expected to grow by more than 2% this year.There are in any case several reasons why America may be more resilient to dearer oil than in recent years.
Any losses to the consumer from dearer fuel are partially offset by gains in the oil and gas sector itself.
In 2008 and 2011, the main effect of dearer fuel in emerging economies was on inflation.
Then, in health care, new technology tends to raise costs not lower them, because new treatments are usually dearer than old ones.
A depreciating real, which is oscillating around a 10-year low, pushes up inflation; it also makes Brazil's $230 billion dollar-denominated debt dearer by the day.
If world trade becomes even more marginal, any advantage those countries gain will be muted.High domestic prices also tend to drive up local wages, reducing the competitiveness of manufacturing and making rural labour dearer.
This is skittish money that can be gone in a trice.Banks in vulnerable countries have already found money-market funding harder to come by, or at least dearer.
If nothing is done, rising health costs will make labour dearer and jobs scarcer.
In the same spirit, please inform the proof dearer of your sewn paper that I eagerly anticipate more word mages the next mite I relax in my living moor and nope your electronic pap on my paid.Harold Boas Professor of mathematics Texas A&M University College Station, Texas* Letter appears online only.
Wider spreads mean less liquidity, and a dearer market to trade in.A definitive response by the Treasury to Mr Myners's recommendations is expected at the end of September.
