Jargon-watch: 'lowflation'

15-1-8-shoppers-634 — Prices are falling in the eurozone? That's "lowflation"!

Growth is slowing in emerging markets. Established economies can't getinto gear. Oil's down, again.

Prices the world over are falling. The global level of low inflation we're seeing is bad, but not half as bad as the word being used to describe it: 'lowflation'.

The term lowflation has gained traction due to "a shifting mindset in financial markets, as investors come to expect perseverant low or falling prices", said Quartz.

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"When widespread, enduring price declines are seen to be the norm, it can spark a vicious cycle of falling profits, investments, jobs and income, which in turn further depress economic activity."

"The difference between that and deflation' is just a matter of degree."

Mischa graduated from New College, Oxford in 2014 with a BA in English Language and Literature. He joined MoneyWeek as an editor in 2014, and has worked on many of MoneyWeek’s financial newsletters. He also writes for MoneyWeek magazine and MoneyWeek.com.