This week we saw some rare good news on the economic front; inflation tumbled to only 0.5%, its lowest rate in four years. Savers can even earn “real” interest, with National Savings offering instant-access accounts paying 1% interest. Don’t laugh at the paltry amount – it has been a long time since they have come anywhere near to beating inflation.

How long will the good news last? It’s one of the thorniest questions vexing economists and money managers alike. Half think that huge job losses, a deep recession and vast spare capacity in the global economy will see inflation banished for years. The other half thinks the trillions of dollars, euros and pounds from pandemic-inspired government stimulus packages must, with almost mathematical inevitability, result in higher inflation.

If you are young (and, importantly, keep your job) a dose of inflation is not necessarily a bad thing; earnings initially lag but then tend to catch up with prices. But if you are old, inflation is a disaster. The real value of your savings and pensions plummets. My grandfather retired in the late 1960s, just as inflation took hold of the British economy. He received a guaranteed 5% annual rise in his pension, which sounds terrific. Except that from 1968 to his death in 1984, prices in the UK rose by an astonishing 437%. His pension more than doubled but prices more than quadrupled. Result, as Micawber might say: “Misery.”

So which direction is inflation heading over the next decade – and what, if anything, can you do to protect yourself?

First, let’s unpick this week’s low inflation number. It’s because petrol – which people have hardly been buying – is significantly down in price. Clothes also contributed to the drop in inflation, falling at an annualised rate of -3%. Meanwhile, the price of food and drink has been rising.

In reality, the things we are not spending money on have become cheaper but the things we actually are spending money on have gone up. Thanks, statisticians – that fall in inflation is not quite as attractive as it first appears.

The reality is that wages and prices are likely to remain depressed as job losses cascade through the economy in the second half of 2020. Boris Johnson’s bungled, late response to the pandemic means Britain’s economic slump will be deep and long. Those queues outside reopened Primarks will soon disappear; it is more likely that British households will keep much higher savings in reserve to cope with continued uncertainty.

All that suggests that inflation will remain low, possibly even negative, in some months. So why fear the beast?

First, globalisation is on the wane. China’s astonishing industrial revolution, the greatest in human industry, has sent the price of nearly all manufactured goods spiralling downwards over the past 30 to 40 years. Now that’s reversing, with the coronavirus shock encouraging us to make more stuff here, and hold larger stocks, too. That may be good for UK manufacturing jobs – but not for prices.

More immediately, how will the huge government stimulus programmes be paid for?

Peter Spiller of Capital Gearing, an investment trust, talks of a “need” for inflation. “Once the crisis abates, public debt will be at levels not seen since the second world war. The solution to such problems will be the same now, as then: financial repression, a prolonged period of low interest rates and elevated inflation. The tools available to governments and central banks are the same as then, we cannot see the outcome being any different.”

Pimco, one of the biggest bond managers in the world, takes a similar position; it thinks there will be a “long climb” in inflation, admittedly from depressed levels. “Debt monetisation and repressed interest rates suggest to us that longer-term inflation risks are tilted to the upside,” it reckons.

But away from fund manager-speak, what does that mean to you? Historically, property has been the best hedge; if you bought a house in the 1970s it jumped in value, while the mortgage debt shrank in real terms year after year. But with property prices now so high in relation to incomes, and interest rates as low as they can go, it seems improbable that property will repeat that trick over the coming decade.

Shares probably offer better protection in the longer term, albeit with huge volatility. National Savings index-linked savings certificates, which match the rate of inflation, would be nice but were removed from sale some time ago. Gold, the embodiment of human greed and vulgarity, dug from deep mines in often gruesome conditions, only to be held behind bars in a bank vault, may well turn out to be the ugly, but safer, bet.

Of course, for the half of the UK population that has almost no assets, and the growing number who will fall on to the dole, this all matters little. The biggest risk to your money is not really inflation – it is losing your job.