Farshlepteh krenk
Why America can’t shake off inflation
Our measure of entrenchment suggests its problem is among the rich world’s worst
People shop for pet supplies at a pet retail store in Manhattan, New York City, USA. / Photograph: Getty ImagesThe Yiddish phrase “farshlepteh krenk”, untranslatable into English, describes an illness that just won’t go away.
That is how some rich countries’ experience of inflation has felt.
The rate of price increases has fallen sharply since the acute phase in 2022, when inflation across the OECD rose to nearly 11%, its highest since the 1970s.
In June average inflation across the club was around 2.5%, only a smidge above most central banks’ targets.
But many Anglophone countries still have lingering symptoms.
To diagnose the malaise more accurately, we have updated our measure of “inflation entrenchment” for ten rich countries.
We construct this from five indicators: core inflation, unit labour costs, inflation dispersion, inflation expectations and Google-search behaviour.
We rank each country on each indicator, then combine the rankings to form an overall score.
The results reveal a linguistic divide.
Countries in the EU and Asia perform well.
France, which also did well the last time we conducted this exercise, in 2024, now has the least entrenched inflation of all the countries we looked at.
Chapeau bas to them. Japanese inflation, true to form, has a feeble grip.
In the English-speaking world, however, inflation looks chronic.
Britain is the worst performer overall. In the year to the second quarter of 2025 the country’s core prices (which exclude food and energy) rose by 4.3%.
Three-quarters of the items in a Briton’s consumer basket have risen in price by more than 2% over the past year—unusually high “inflation dispersion”.
Australia is not far behind, with unit labour costs (what is paid to workers to produce a unit of output) nearly 5% higher in the first quarter than they were a year before.
Despite a weaker economy than its southern neighbour, Canada’s inflation problem is almost as bad.
A few factors may explain the persistence of inflation in these places.
From 2022 to 2024 the governments of Anglophone countries, on average, increased their budget deficits by two percentage points of GDP, versus a one-percentage-point contraction elsewhere.
This boosted demand—the equivalent of licking doorhandles in an attempt to fight off an illness.
English-speaking countries have also welcomed lots of immigrants in recent years.
At least in the short run, the new arrivals may push up the prices of certain things, especially housing.
Amid this bad news, there is still cause for hope that inflation will soon look less entrenched.
The absolute level of inflation entrenchment seems to be ebbing: the country with the least entrenched inflation last time we did the exercise, Japan, would have ranked sixth-worst this time.
The Bank of England can point to Britons’ weak inflation expectations as evidence that price pressures will soon fade.
The Bank of Canada can highlight low inflation dispersion.
In addition, most Anglophone governments are simultaneously tightening fiscal policy and slashing immigration.
Although immigration is declining, the government still has its foot on the fiscal pedal.
And President Donald Trump’s tariffs have stoked fears of another round of price rises, as American firms pass their higher costs on to consumers.
Americans are more likely than others to Google inflation-related terms.
Over the coming year, the public expects prices to rise by 5.5%, higher than people in any other country.
A lingering illness is annoying; one that gets worse is harder to bear.
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