23 Hrs
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اقتصاد سكاي نيوز عربية
Inflation Fight Gets More Complex
Central banks around the world are facing a dilemma in controlling inflation, which has become characterized by structural factors such as rising energy prices, disruptions in supply chains, and geopolitical tensions. These factors make it difficult to address inflation solely through conventional monetary policy tools. While they have succeeded in reducing demand-driven inflation by raising interest rates, they struggle to tackle supply-side inflation linked to increasing external costs and shrinking productive capacity — a situation known as "stagflation." Reports indicate that factors like the decline of globalization, investments in clean energy, and geopolitical challenges make inflation more volatile and more resistant to traditional financial remedies. This underscores the need for a combination of monetary, fiscal, and investment policies to enhance economic resilience and supply chain stability.
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