Yes, but why now?
They have been printing money for a long time.
This is a question I have never seen these inflation hawks answer: If printing money triggers inflation, why is there a 14 year lag on that effect?
They have been printing money for a long time.
This is a question I have never seen these inflation hawks answer: If printing money triggers inflation, why is there a 14 year lag on that effect?
Now new money is being spent on consumer goods while supply of goods and services have been severely restricted during the corona panic. Of course soaring energy prices is now also contributing.
The argument I've heard, though am not well enough equipped to fully analyze, is that the created money was going into overseas accounts as various nations tried to accumulate the global reserve currency - dollars - to purchase oil and other products that were generally traded in dollars. As long as that remained the case, an awful lot of dollars could be printed, spent, and ended up squirreled away elsewhere not really having an impact (velocity of money and such).
Now, though, that arrangement is ending - in no part due to the US abusing our financial system to control what everyone else can or can't do (see Visa's opinions about what industries they'll serve for an example, also SWIFT, global sanctions, etc). So other countries are making other arrangements that don't involve dollars - I'm pretty certain dollars aren't involved in the Russian oil sales to various other countries in their sphere anymore. And any reasonable country that isn't heavily tied to the US has to be figuring out how to move off dollars.
So now those all come home to roost, and combined with the lack of things to buy, we see the nasty inflation we're getting.
I'm not certain how well it holds up if you really dig into it, but there are certainly people answering your question if you actually go looking for how it's being answered.
The money printing of the last x years has arguably resulted in asset price bubbles (housing, stocks, real estate), but didn't cause "inflation" because if e.g. people buy more nintendo switches, nintendo just makes more nintendo switches at the same price.
What happened recently was supply chains / workforces got disrupted by covid (and possibly protectionist trade policies)... and then covid "ended" and demand rebounded to 2019 levels, but supply takes longer to ramp back up. That, coupled with Russia's attack on Ukraine and the decrease in the supply of energy, caused a spike in actual goods/services prices.
Raising interest rates serves to pop the asset bubbles (and already has), but I think only time will solve the supply chain / energy restriction-caused "actual" inflation.
Since the USD is a safe haven currency it has held up extremely well relative to other currencies recently. The UK just ran into the limit of loose fiscal policy which imo is a commentary on the extent of their decline as a world economic super power and demand for/perceived safety of GBP.
2) They turned up the printing 10x.