To historian Shirley Tillotson, today's central bankers may be girding themselves for battle against a phantom, spooked by fears of a wage price spiral burned into their collective economic memory from a bygone era. Something like a nuclear chain reaction, the spiral happens when those higher prices spur more wage demands that lead to even higher prices in an endless cycle. Wishing for better pay isn't enoughIn the current round of inflation, one flaw with the concept of a wage price spiral is that before the current wave of inflation began, wages had hardly budged. "It's not a case of wage price spiral," said Stanford. "It looks more like profit price inflation to me where companies very opportunistically have taken advantage of a disruptive moment to soak consumers for more than they need to."

Source: CBC News June 28, 2022 16:06 UTC