Energy Prices Forced The Eurozone’s Annual Inflation Rates To Its Highest-Ever Level

Jan. 9th, 2022

Image: AFP/Paul ELLIS

According to a report by EDNH News on January 8th, 2022, it talks about how soaring energy prices forced the Eurozone’s annual inflation rates to their highest ever level last month, according to the Eurostat agency. Officials and economists expect the rate to fall over the year to come, but the record level will add to pressure on the ECB to reconsider its historically low-interest-rate policy. The 5% December figure is the first estimate but confirms a trend that has pushed the rate to a quarter of a century high, the peak since records began in January 1997. These figures are well above the European Central Bank’s target of 2% inflation in the eurozone, but the ECB believes that inflation should fall in 2023, after peaking in 2022.

The massive increase in fuel mainly gas and electricity of around 26% which was far more than anyone could have predicted has had a knock-on effect on other items like food, alcohol, and tobacco which have risen by around 3%, and also industrial goods and services rising by around 3% and 2.5% respectively.

Spain and Germany are suffering particularly badly as inflation has risen much more than France and Italy, with Germany at almost 6% and Spain at almost 7% with price increases more moderate in Italy and France, according to harmonised European data calculated by Eurostat. German consumers and policymakers have a historic fear of inflation and the surge in price increases has generated pessimistic media headlines as Chancellor Olaf Scholz’s new coalition government tries to find its feet.

There are many different reasons for the inflationary rise throughout Europe and the CCP virus that has halted production and stagnated financial institutions is only one of them, but obviously with the pandemic and with the majority of people being at home with the heating on it has not been a surprise that the fuel prices have gone through the roof. Supply and demand at its very best or worst depending on which side of the fuel empire you sit on.

For more information about this story please click the link: Eurozone inflation hit record high in December

Editor: Mr Cow

PR: Mini Cow

Edited by:【Himalaya London Club UK】

Disclaimer: This article only represents the author’s view. Gnews is not responsible for any legal risks.

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