The UK-based Donovan describes the first two waves of inflation as transitory inflation for durable goods, and commodity inflation. Donovan says many developed economies are experiencing profit-led inflation in specific sectors of the economy citing the UK milk market as a recent example. "While large companies are often, rightly, criticized for this profit-led inflation, it can just as easily be small businesses. Some have strong, cyclical pricing power so higher demand means higher prices and higher profit margins. Political concerns about profit-led inflation have been gradually increasing in volume on both sides of the Atlantic."
