More uncertainty, however, surrounds the outlook for inflation. The past decade of low inflation and solid economic growth in the United States and in many other countries around the world has been without precedent in recent decades.
Much of that favorable performance is attributable to the remarkable confluence of innovations that spawned new computer, telecommunication, and networking technologies, which, especially in the United States, have elevated the growth of productivity, suppressed unit labor costs, and helped to contain inflationary pressures. The result has been a virtuous cycle of low prices and solid growth.