The rate of inflation in the world’s leading economies, as well as in Malta, has now been very level for years. I have often commented in the past what may be some of the downside risks of inflation, and subsequently interest rates, were to increase. The question that is now being put is whether there is a risk of an increase in the rate of inflation in the US and in the eurozone sometime this year or in early 2022. However, let us proceed in some form of order. Inflation is normally a sign of a booming economy. However, after the economic slump, which followed the financial crisis of 2008, economies picked up very slowly. Some never really picked up enough by the time of the next slump, this time caused by the coronavirus last year. The rules of the eurozone hindered governments from having an expansionary fiscal policy. Therefore, it was left to the European Central Bank (ECB) to adopt a loose monetary policy stance to stimulate economic growth. Money became very cheap, with interest rates around zero. Moreover, both the ECB and the Federal Reserve of the United States continued to release liquidity into the market through their quantitative easing programmes. Their stated...