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CNBC/Steve Goldstein
“Bank of England monetary-policy committee member Silvana Tenreyro demonstrated that latter point in a speech Wednesday in which she quoted unpublished research on the impact of pandemics on inflation. The Bank of England charted historical inflation data from the U.K. and seven other countries, including the U.S., to estimate the response of inflation to pandemics. These episodes typically led to persistent declines in inflation, she said.”
USAGOLD note: Of late, we have posted a number of articles and analyses predicting higher inflation down the road tied to massive government and central bank stimulus. Bank of England’s Tenreyo has a different take. One glaring determinant, however, can be gleaned from a quick look at the primary chart published with the study (which covers a period 1250 to present). Most of the pandemics occurred when the world was on some version of the gold standard and debasing a currency was a more difficult task for governments and/or central banks to accomplish.
Repost from 7-16-2020