Inflation to stay low for a long time

The impact of the crisis so far has been overwhelmingly disinflationary, and with demand likely to be depressed for a long time to come, inflation is set to remain very weak. A period of entrenched deflation is a growing concern in some countries, most notably Thailand. With inflation set to stay very low, further interest rate cuts are likely over the coming months, while some countries are likely to embark on quantitative easing.