Inflation in the euro area as a whole in 19 member countries surged to 4.9% in November, surpassing city expectations. European Central Bank Review the policy of ultra-low interest rates.
Some investors responded to the news by accusing the ECB of out of control of inflation, and the Eurostat of the European Bureau of Statistics said early preliminary figures for inflation in November were associated with a relevant record in 1997. He said he had reached the highest level since it began in. The euro has been released.
Soaring gasoline prices and the cost of imported goods were due to the surge in inflation. Energy prices, including oil and gas, have risen 27% since November 2020, and headline rates in October have risen from 4.1%, according to Eurostat.
France suffered a 3.4% rise in inflation, the highest in the last decade, but prices soared and inflation reached 6% in Germany, one of the block’s largest economies. Inflation rose 8.4% in Estonia, but reached 9.3% in Lithuania.
Other developed countries have been plagued by similar inflationary pressures since the summer. The United States recorded an inflation rate of 6.2% in October. This is the largest 12-month rise since 1990, with annual prices rising by an average of 4.2% in the UK over the same period.
On Wednesday, the UK Retail Consortium said overall store prices rose in November at the fastest pace since May 2019. Slowdown in prices and non-food deflation.
Why is the BRC number different from the Consumer Price Index used by the National Bureau of Statistics, which also considers transportation and utility costs, as it is based on prices in the 500 food and non-food range in the store? Is it? And eating out.
Charles Hepworth, investment director at GAM Investments, said that the eurozone exceeded the city’s economists’ average of 4.5%, “the belief from central bankers that this cost-push inflation is temporary. He continues to point out incredibly contradictory arguments. “
So far, like most central bank governors, the ECB Christine Lagarde It claims that inflationary pressures are temporary and will probably begin to weaken in 2022.
Hepworth said the position would be tense, even though it could adversely affect the emergence of Omicron variants of Covid-19 and recovery from pandemics.
“When she declares that price pressure will never go out of control, she may make wishful thinking on Lagarde’s side. They are already out of control and it is difficult to follow the argument that they will soon ease. “He said.
Eurozone core inflation, which removes potentially volatile items such as alcohol, energy, food and tobacco, also surged from 2% to 2.6% annually in November.
Some analysts said the strength of the ECB’s rise in core prices above the 2% target indicates that headline inflation is already having a secondary impact through higher wage demand. ..
However, ECB officials are expected to take a more cautious view, refraining from announcing major policy changes while testing for the effects of Omicron.
If varieties begin to affect growth levels, prices such as oil will probably fall, easing inflation around the world.
Jack Allen Reynolds, Senior European Economist at Capital Economy“Omicron variants have further increased the level of uncertainty, but for now the impact on inflation seems to be fairly small.”
Eurozone inflation surges to 4.9% – the highest since the euro was introduced | Eurozone
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