Research Briefing

A greener economy won’t lead to 1970s-style inflation

Global | A greener economy won’t lead to 1970s-style inflation

The transition to a greener economy through changes in government climate policy, technology, investment, and consumer preferences will fuel huge demand for key raw materials and may create inflationary threats in the economy.
However, given the decreasing role of commodities in determining inflation over the past few decades, the expected supply response to currently elevated commodity prices, and generally well anchored inflation expectations, a shift to persistently higher inflation via this channel is unlikely in the near-term.
What you will learn:

  • Pandemic supply constraints and financial speculation are also at play
  • Over the next few years, green commodities are also likely to reflect a fraction of commodity consumption
  • Also, several factors that have led commodities to play a smaller role in the economy
Back to Resource Hub

Related Services

Post

UK: Housing market on course for a soft landing

The recent sharp fall in mortgage rates and continued strong growth in wages has significantly reduced the scale of the UK's housing affordability problem. Consequently, the risk of a steep correction in house prices is much lower than it appeared a few months ago. We also expect the recent steady pickup in housing market activity to continue.

Find Out More

Post

Global Industry: Energy transition will transform mining—promise and pitfalls

We expect that demand for energy transition-related critical minerals will grow significantly in the next decades even in the absence of rapid progress required to achieve net zero.

Find Out More