Step: inflation hit the entire globe and was mostly caused by the following as listed here:
1. The shocks to food and energy prices contributed substantially to the sharp rise in inflation during the COVID-19 period. Energy price shocks were the primary cause of the high inflation rates from late 2021 to the middle of 2022. Lower energy prices in the second half of 2022 contributed to the inflation decline during that period.
2. The combined effects of increased demand for durables and shortages caused by supply-chain disruptions were the main source of inflation in the second quarter of 2021. Both the direct and indirect effects of those supply-chain problems remained substantial through the end of 2022.
3. Tight labor-market conditions, one of the main concerns of the early critics of U.S fiscal and monetary policy, contributed only slightly to inflation. In fact, the tight labor market affected the economy negatively in 2020 and early 2021. Since then, however, the traditional Phillips-curve effect has begun to reemerge, with the high vacancy-to-unemployment ratio becoming an increasingly important factor in the high inflation rates.
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