Demand-shift inflation (also referred to in German)

Price increases caused by shifts in demand. – If, for example, demand shifts from steel to aluminum, the steel mills have to pass on the very high fixed costs to a smaller production volume and therefore increase prices. On the other hand, aluminum smelters reach their capacity limits and fend off excess demand – initially until expansion investments are completed – by charging higher prices. – See cost-push inflation, inflation.

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