The government is arguing with the opposition about the causes of inflation, who is closer to the truth?
The beginning of the current rise in inflation is on the supply side. Regardless of political preferences, however, it is clear that the government’s huge fiscal stimulus has contributed, and more importantly, will contribute to higher inflationary pressures on the demand side. In addition, a very tight domestic labor market and too low unemployment will continue to push inflation through wage growth.
It is possible to determine to what extent the CNB, resp. government, resp. “Forces” independent of the Czech Republic?
It is a joint influence of several factors, the share of which gradually changes over time. The primary supply factors of inflation, ie the relaxed monetary policy of central banks and problems in international trade, ie especially higher commodity prices, shortages of parts or shortfalls in transport, are gradually spilling over into demand factors, which are fueled by the government. This is through high wage growth in the public sector or higher pensions, which exacerbates the inflexible labor market, which is reflected in too low unemployment.
Inflation: It has risen the most in the last 13 years