inflationary spiral

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inflationary spiral

(Economics) the situation in which price and income increases may each induce further rises in the other

infla′tionary spi′ral

a cycle of worsening inflation as higher prices result in higher wages, increasing costs and resulting in still higher prices.
ThesaurusAntonymsRelated WordsSynonymsLegend:
Noun1.inflationary spiral - an episode of inflation in which prices and wages increase at an increasing rate and currency rapidly loses value
spiral - a continuously accelerating change in the economy
deflationary spiral - an episode of deflation in which prices and wages decrease at an increasing rate and currency gains in value
References in periodicals archive ?
The ECB needs to do this in order to prevent imported inflation from food and energy prices triggering a price-wage spiral in Europe's heavily unionized economy.
Over the past six months, food and energy prices have risen at an annualized rate of 17 percent, prompting speculation of a possible price-wage spiral that will result in rampant inflation.
Sustained, heightened inflation expectations would be liable to adversely affect the behaviour of price and wage setters, thereby increasing the risk of a very damaging price-wage spiral developing.
Secondly, given the fact that wage formation in Germany is especially reactive to economic conditions and that many wage agreements there are up for renewal well after the impact of indirect taxes on inflation will have petered out, a price-wage spiral in Germany is very unlikely.

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