Understanding Inflation Expectations

From apricitas.io

In Argentina, annual inflation is running above 60%. The central bank and central government are trying a litany of policies, conventional and unconventional, to get inflation under control—but Argentinians aren’t buying it. After decades of high inflation, people do not trust the authorities and expect inflation to persist at its extremely-high levels. Workers must renegotiate wages frequently, consumers rush to make major purchases, businesses are forced to constantly revise prices upwards, investors forecast significant devaluation of their peso holdings, contracts build in high expected inflation, and saving ... (full story)