Global economy and deflation shock

While inflation has not yet returned to the 2% target in most major economies around the world, the risk of deflation is approaching.

In fact, a deflation shock can occur if prices drop suddenly. And for economists, the fear of deflation is much more terrifying than the risks posed by high inflation. This has been discussed in previous podcast by the Viet Hustler team. 

However, the risk of deflation has come closer compared to the last time Viet Hustler discussed this issue. Because a series of leading indicators - sensors of the economy, indicate the possibility of price drops in the near future. These indicators include manufacturing PMI, global supply chain indices, and business price expectation surveys….

Therefore, Viet Hustler will analyze in more detail the current deflation risk and the relationship between inflation-deflation and M2 money supply. Why has the Fed lost control over M2 money supply? What are the causes and risks of deflation for the economy?

All will be answered in the article below, in Viet Hustler's weekend macroeconomics column. 

What you need to know about deflation risk (deflation risk)

What is deflation (deflation)? Why is deflation more frightening than inflation?