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Consumer Congestion, Higher Energy Prices, Loose Monetary Policy: Is Massive Inflation Looming After Covid-19?

Author

Listed:
  • Markus Demary
  • Timo Wollmershäuser
  • Gerit Vogt
  • Gertud R. Traud
  • Stefan Mütze
  • Thomas Mayer
  • Pascal Seiler
  • Lukas Haffert
  • Nils Redeker
  • Tobias Rommel

Abstract

Inflation was not an issue to worry about for a long time. In Germany and other advanced economies, inflation has tended to fall rather than rise in recent decades. Since the beginning of this year, however, inflation in Germany has accelerated sharply. In August 2021, the inflation rate reached a level that was 3.9 percent above the corresponding level in the same month of the previous year. What factors have influenced this current development? Is inflation returning, in the sense of a sustained and broad-based stronger rise in prices?

Suggested Citation

  • Markus Demary & Timo Wollmershäuser & Gerit Vogt & Gertud R. Traud & Stefan Mütze & Thomas Mayer & Pascal Seiler & Lukas Haffert & Nils Redeker & Tobias Rommel, 2021. "Consumer Congestion, Higher Energy Prices, Loose Monetary Policy: Is Massive Inflation Looming After Covid-19?," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 74(09), pages 03-26, September.
    • Handle: RePEc:ces:ifosdt:v:74:y:2021:i:09:p:03-26
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    References listed on IDEAS

    as
    1. Brendan Nyhan, 2020. "Facts and Myths about Misperceptions," Journal of Economic Perspectives, American Economic Association, vol. 34(3), pages 220-236, Summer.
    2. Lukas Haffert & Nils Redeker & Tobias Rommel, 2021. "Misremembering Weimar: Hyperinflation, the Great Depression, and German collective economic memory," Economics and Politics, Wiley Blackwell, vol. 33(3), pages 664-686, November.
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