The resurgence of inflation: Why was emerging Asia different?

Fatás, Antonio

No 19445, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: The post pandemic years have brought inflation back to levels not seen for decades. While this surge has been a global phenomenon, the impact has not been uniformly felt across all regions. Notably, Asia, among the emerging and developing economies, has experienced a comparatively mild rise in inflation, with rates not significantly diverging from those seen in previous inflationary periods. This paper explores the factors that might explain the distinct behavior of Asia. We provide evidence that a combination of weaker post-pandemic recovery, a less aggressive traditional fiscal policy, a strong use of subsidies, minimal depreciation of exchange rates, and a history of lower and less volatile inflation account for this region differential’s response.

Keywords: Asia (search for similar items in EconPapers)
JEL-codes: E31 E32 E52 E60 (search for similar items in EconPapers)
Date: 2024-09
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