Globalization and digital innovation are the main suspects for the death of inflation. Being common factors, they explain the proximity to zero of the change in consumer prices in all major economies. In the Eurozone in August it was 1%, 0,9% net of food and energy. In Use it appears higher (1,8% in July), but only because the Americans also include in the index the rents attributed to those who live in their own homes; without them it would be 1,3%.
Low inflation inspires wage dynamics contained, which, by extension, perpetuate low inflation. On the other hand, in the advanced countries the bargaining power of the workers has been diminished by the massive competition of vast armies of people who inhabit the emerging countries.
Le raw material they respond directly to real signals from the economy and therefore are weaker today and contribute to reducing inflation.
