Other reasons are rising inflation expectations; climate change and energy transition; and waning global forces.

A scenario of unmoored inflation expectations and wage-price spirals is less probable, though the risks need close monitoring, particularly in other parts of Europe, Ken Wattret, vice president, economics, IHS Markit said in a release.

While extreme events such as the COVID-19 pandemic and Russia's invasion of Ukraine have been fundamental to the short-term surge in goods inflation rates, they are also likely to reinforce the longer-term trend away from many of the disinflationary forces which held it down in the past.

Global trade as a share of gross domestic product (GDP) peaked back in 2008 and more recently, the ‘trade wars’ from 2018 and the subsequent extreme disruptions caused by the pandemic and the Russia-Ukraine conflict suggest security of supply chains is likely to take priority over competitive pricing for key products. The attraction of outsourcing is also diminishing for various reasons, he said.

If a central bank is credible in its commitment to maintaining price stability, longer-term inflation expectations should remain well anchored, preventing wage and price-setting behaviour being subject to inflationary fears.

However, there have been signs recently that inflation expectations might be becoming less well anchored and there may be constraints (e.g., political pressures, recession risks, declining asset prices) on how far central banks are willing to go to keep them in check.

While the recent pick-up has been most apparent in shorter-term, consumer-based measures of inflation expectations, this is still relevant as they can influence wage bargaining, IHS Markit said. While the signals from longer-term inflation expectations have been more comforting, there too some warning signs are flashing.

Although surveys of forecasters' expectations appear well anchored still, they typically do not deviate far from central bank inflation targets. In contrast, market-derived measures have picked up markedly since 2020 in some cases, though the trends are not uniform.

Global warming is associated with a greater incidence of damaging climatic events, which may impact specific prices, notably for food. The transition to a net zero carbon emission world implies sharp increases in the price of carbon, in turn affecting consumer prices directly through higher energy prices, and indirectly through increased costs of production.

Higher prices for the commodities are essential to the deployment of ‘green technologies’, London-based IHS Markit added.

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