Do you really know? Why don't prices fall when inflation slows?
Mar 10, 2026
They unpack why slower inflation does not mean prices actually fall. They explore the real drivers of recent price rises like energy, commodities and global shocks. They explain why wages and corporate practices keep prices elevated. They contrast disinflation with dangerous deflation and what policy targets imply for future prices.
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Regulation Can Reveal Shrinkflation But Not Reverse Prices
- Policy and consumer protections like mandatory shrinkflation labels can curb some commercial practices but won't automatically produce lower shelf prices.
- Amber cites the July 1, 2024 rule requiring supermarkets to label products affected by shrinkflation as an example.
Slowing Inflation Is Not Price Cuts
- Disinflation means prices are rising more slowly, not that they fall.
- Amber Minogue contrasts 2013 grocery prices with 2023 to show that slowing inflation doesn't rewind past price increases.
Costs And Wages Lock In Higher Prices
- Price changes reflect input costs like commodities and energy, which recently stabilised after shocks from Ukraine, climate change and the pandemic.
- Amber notes wages rose with past inflation and typically don't fall when input costs ease, keeping retail prices elevated.