Why inflation might follow the pandemic

Does this mean the question of whether this long debt cycle must end in inflation has to be answered in the affirmative? No, but this is possible

Broad measures of money supply had grown slowly since the 2008 crisis.

But this time it really is different.

 If one is a monetarist, like Tim Congdon, the combination of constrained output with rapid monetary growth forecasts a jump in inflation. But it is possible that the pandemic has lowered the velocity of circulation

Martin Wolf FT 19 May 2020


The inflation hawks may be right, but when 30-year bonds are trading at 1.35 per cent interest rates, the collective wisdom of the market is making a huge bet in the other direction. 

FT 19 May 2020



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