The response of central authorities to the pandemic was decisive – reflationary policies that injected massive amounts of money into both the financial system and the real economy, turbocharging credit growth and asset valuations. However, the unintended consequence of all this stimulus was an unwelcome surge in inflation, exacerbated by the energy price shock caused by Russia’s invasion of Ukraine in February 2022. High and persistent inflation forced a sharp shift from a highly accommodative monetary policy stance to aggressive monetary tightening. These measures have already caused considerable stress in markets, with potentially much more to come.