While we may wish for lower inflation in the UK, surprisingly or not inflation is not a bad thing as long as it’s small amount (roughly 2% for the UK at least). On the contrary deflation is never usually a good sign especially if it is persistent so China’s deflation could be a sign of their economy shrinking and economic activity may also be shrinking. What are you viewpoints on this?
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it seems like a good balance is needed - for my home country, singapore, we aim for a "low steady rate of inflation growth’ to ensure sustainable economic growth
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The Bank of England adopt a similar policy as they use a 2% inflation target.
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Wouldn’t be able to say that I’m an expert. But very interested to see other students’ points of view🙏
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Inflation indeed serves as an indicator of a healthy economy, signaling growth and stability when kept in check. Conversely, persistent deflation often points to economic downturns, impacting consumer spending and overall prosperity. Maintaining a delicate balance is key for sustainable economic development.
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