Who wins and who loses when the central bank does not react to inflation?

The central banks of the United States and , even more so , the euro zone are not reacting to inflation. It is interesting to look at what this means in terms of redistribution: who wins and who loses from a situation where nominal interest rates do not keep up with inflation? Highly negative real interest rates favour all indebted economic agents; But we also have to look at income effects, first concerning wages. If wages do not keep pace with prices, households will lose; governments will also lose if they support household purchasing power. This income loss reduces the improvement in the debt ratio; If wages are closely indexed to prices, there will be no income loss for wage earners but there will be an income loss for companies, which may also reduce the improvement in their debt ratio; We also have to look at capital income. Bondholders (middle-class households) will lose; We must then look at the wealth effects: negative real interest rates support asset prices (equities, real estate, companies), which favours wealthy households. We see the complexity of the redistributive effects linked to central banks’ lack of reaction to inflation: Fall in debt ratios; Fall in real wages or in real earnings; Additional public spending to support purchasing power; Income loss for bondholders; Increase in asset prices.