Charts (update): Inflation? Where?18 July, 2012, 0:22. Posted by Zarathustra
Last month, we produced a few charts showing that there has been no inflationary pressure left whatsoever for major economies despite the fear that money printing will eventually lead to inflation. There is absolutely no evidence of any threat of hyperinflation, and it is curious indeed that the inflationary obsession lives on for so long.
As we got the US and US inflation numbers, it is time to update these charts.
As you can see below, inflation on a year-on-year basis has peaked last year, and it is crashing down. Even China, with their enormous money creation in the past few years (which made the money printing in the West looks like amateur), has its year-on-year inflation down to just 2.2% (although not completely trustworthy).
On a month-on-month basis, prices continue to be falling or flat. Most major economies record month-on-month fall of general price level, with the US the only exception, which recorded a flat price level (all items).
The message here is clear: there is no threat of (hyper)inflation. If anything, it is deflation, which looks more like the real threat.