QNB expects deflation to dominate future macro trends
The Peninsula
Doha: Qatar National Bank (QNB) group said that secular deflationary forces, particularly from technological progress, automation, and the digitizatio...
Doha: Qatar National Bank (QNB) group said that secular deflationary forces, particularly from technological progress, automation, and the digitization of services, are expected to remain dominant over the long term, but they are increasingly being punctuated by short, sharp episodes of inflation driven by supply shocks associated with geopolitical tensions, green transition costs, and policy uncertainty.
In it weekly commentary, QNB pointed that global economy is no longer anchored in a stable inflationary or deflationary regime, but rather navigating a new era marked by structural volatility.
According to QNB, prices changes of key baskets of goods and services are some of the most closely watched metrics in macroeconomics, alongside economic growth.
They are crucial indicators of economic health, affecting everything from purchasing power and household confidence to investment decisions and monetary policy.
While some level of price appreciation (inflation) is a normal and even desirable feature of a growing economy, both excessive inflation and outright price declines (deflation) can cause significant distortions and long-lasting damage, QNB said.
