A majority of the 161 economists polled by Reuters believe that the coronavirus pandemic is likely to result in deflationary pressures globally even if its subsides in the year ahead.
“Over 70% of more than 160 economists from Asia to Europe to the Americas in the latest poll said the bigger threat once the pandemic is under control would be lower prices.
That proportion was roughly evenly spread by region as well.
If anything, the current dilemma for central bankers is that the effect of the crisis is raising more questions about policies based on consumer inflation targets that now look less likely to be achieved, even as asset prices soar.
Major developed-economy central banks have struggled to achieve those targets in recent years and aren’t expected to for at least another three, despite expectations for them to expand their balance sheets to record highs.”