The drivers of low inflation There are a number of usual suspects cited for what is causing low inflation.
Many of them are slow-burning structural changes taking place throughout the world, some of which have been covered in depth at this conference:   Globalisation: Global supply chain integration has lowered the costs of manufactured goods.1    Technological changes: New technologies and low-cost software services are continually driving down prices for these goods and services.2    Demographics: Populations are ageing in many countries, increasing savings and decreasing inflationary pressures.3    Labour market dynamics: Labour markets and work practices are evolving around the world, creating more capacity and less wage pressure than in the past.4  These are deep and fundamental issues that deserve further research to truly understand their contribution to low inflation, and the policy implications for central bankers.