The wage-price spiral of the 1970s has been avoided, but the income shock is painful.

ECONOMIST: The oil price: Recoil | The

For higher inflation to become dangerous a wage-price spiral is required, and without higher wages, there is no spiral.

ECONOMIST: The economy

The country is showing signs of a wage-price spiral, with annual inflation touching 26%, labour unrest and a threatened general strike.

ECONOMIST: Sri Lanka

The central bank's only job is to make sure higher food costs do not translate into higher pay demands, which might start a wage-price spiral.

ECONOMIST: Price rises in China