Demographics: a drag on the boat?

We all are getting older, and so are our societies. And this affects how fast our economies can grow. While immigration has brought more foreign workers into our labour force in recent years and therefore helped our economies grow, this support may not last. With more people retiring and fewer workers entering the labour force, the balance between young and old is shifting.

The ageing of our population is expected to pull inflation down in the longer run. But it may also reshape how fast and how much the economy can grow, what goods and services we consume and how public money is spent.

These trends matter for monetary policy.