Infotech

The rebound in inflation complicates the task of the ECB



Posted on Feb 3, 2019 2021 at 18:02Updated Feb 3, 2019 2021 at 18:16

This should be good news for the European Central Bank. But rising inflation, after several months in negative territory, could turn into a puzzle. Admittedly, this increase in the price index in January was expected. But its magnitude surprised economists, exceeding expectations. ” It looks like this is the first year in a long time that the ECB’s inflation forecast has been too low “ING economist Carsten Brzeski quipped on Twitter.

In fact, for the first time since July, European inflation over one year rose to 0.9%, against the 0.3% expected by economists at the central bank. Even more striking, “core” inflation, an index that excludes the much more volatile prices of food, energy, alcohol and tobacco, reached 1.4%. Its highest level in five years. Are the efforts of the ECB, which has set its key rates at extremely low levels and is buying back bonds in the market, finally starting to bear fruit?

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