Your pay is still going up too fast
Why the last part of the inflation fight may be the hardest
Central bankers are entering the final stretch. Rich-world prices are rising by 5.4% year on year, down from a peak of 10.7% in October 2022. Although this is impressive progress, the last part of their quest—getting inflation from 5.4% to official targets of around 2%—could be the most difficult. That is because labour markets are not co-operating.
This article appeared in the Finance & economics section of the print edition under the headline “Wages of destruction”
Finance & economics February 3rd 2024
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From the February 3rd 2024 edition
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The great-man theory of Wall Street
Why finance is still dominated by bold individuals
Hong Kong’s property slump may be terminal
Demographics and geopolitics will make a recovery harder
Why everyone wants to lend to weak companies
An unanticipated side-effect of Donald Trump’s election victory
American veterans now receive absurdly generous benefits
An enormous rise in disability payments may complicate debt-reduction efforts
Why Black Friday sales grow more annoying every year
Nobody is to blame. Everyone suffers
Trump wastes no time in reigniting trade wars
Canada and Mexico look likely to suffer