It's been ages since we had to worry about big price rises, as this chart of underlying inflation in the OECD, a group of developed countries, reminds us. The key reason for disinflation in the past two decades was globalisation, which shifted power from labour to capital, says Andreas Niehaus in Finanz und Wirtschaft.
The global workforce almost doubled between 1990 and 2001, while automation and digitalisation also lowered production costs. This halted wage-price spirals even when growth was strong. But inflation may be making a comeback and central banks don't seem ready to respond.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
-
Top-quality, rapidly growing European stocks are selling at enticing valuationsTimothy Lewis, portfolio manager at JPMorgan European Growth & Income tells us where he’d put his money
-
Check Your State Pension forecast tool launched to ‘simplify’ filling National Insurance Contributions gapsNews The government claims the online Check Your State Pension forecast will allow people to avoid having to phone HMRC and the DWP
-
The charts that matter: bond yields and US dollar continue to climbCharts The US dollar and government bond yields around the world continued to climb. Here’s what happened to the charts that matter most to the global economy.
-
The charts that matter: markets start the year with a crashCharts As markets start 2022 with a big selloff, here’s what happened to the charts that matter most to the global economy.
-
The charts that matter: Fed becomes more hawkishCharts Gold rose meanwhile the US dollar fell after a key Fed meeting. Here’s what else happened to the charts that matter most to the global economy.
-
The charts that matter: a tough week for bitcoinCharts Cryptocurrency bitcoin slid by some 20% this week. Here’s what else happened to the charts that matter most to the global economy.
-
The charts that matter: omicron rattles marketsCharts Markets were rattled by the emergence of a new strain of Covid-19. Here’s how it has affected the charts that matter most to the global economy.
-
The charts that matter: the US dollar keeps on strengtheningCharts The US dollar saw further rises this week as gold and cryptocurrencies sold off. Here’s how that has affected the charts that matter most to the global economy.
-
The charts that matter: gold hangs on to gains while the dollar continues higherCharts The gold price continued to hang on to last week’s gains, even as the US dollar powered higher this week. Here’s how that has affected the charts that matter most to the global economy.
-
The charts that matter: inflation fears give gold a much needed boostCharts US inflation hit its highest in 30 years this week, driving gold and bitcoin to new highs. Here’s how that has affected the charts that matter most to the global economy.
