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Think you will see this on mainstream media?….and the EU is just getting there while our core inflation has leveled off.
July 3, 2022~Headline inflation came in at 8.6% (year-on-year) for last month, according to preliminary figures from Europe’s statistics office Eurostat released Friday. That beat a prediction of 8.4% in a Reuters poll of economists. The rate had reached 8.1% in May which means the cost of living is continuing to surge across the euro zone nations.
But both France and Spain experienced new inflation records in June with the latter surpassing the 10% threshold for the first time since 1985, according to Reuters.
“If the inflation outlook does not improve, we will have sufficient information to move faster,” Lagarde told an audience in Sintra, Portugal, about the period after that September hike.
However, there are growing questions about the future of monetary policy in the euro zone amid fears of a recession in the coming months. If the central bank were to move quickly in hiking rates, this could hamper economic growth even further at a time when a slowdown is already underway.
However, further economic pressures from Russia’s invasion of Ukraine — most notably over energy and food security — could tip the region into a more proacted slowdown earlier than expected.
So far, European officials have avoided talk of a recession.
Speaking in a flash research note after the data release Friday, Andrew Kenningham, the chief Europe economist at Capital Economics, said that the 8.6% figure is “probably not enough to bring a 50bp rate hike (rather than 25bp) back into play for July.”
