Do demographics explain structural inflation?

Demographics-related inflation will be a more impactful force in global economy as we move into the next decade

May 10, 2018 | Ray Janssen

In aggregate, the world’s population is graying, caused by a combination of lower birthrates and longer lifespans. Another worldwide phenomenon is a 25 year-long decline in the rate of inflation. Accepted doctrine is that these two trends are intertwined – many observers believe that aging results in shrinking consumption which leads to lower inflation. We believe this relationship may be reversed – we believe that aging may lead to higher inflation, meaning that the US could face higher structural inflation in the future.


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