Rising Inflation: Transitory or Cause for Concern?
Consumer price inflation in the euro area has sharply risen to 3% in the course of 2021. This increase was mainly due to higher energy prices and other transitory factors. Recent macroeconomic forecasts generally expect inflation to return to below target values next year. However, there are several factors in place that could lead to more sustained upward pressure on prices, and materialisation of these upward risks could force the ECB to take difficult choices. This paper was provided by the Policy Department for Economic, Scientific and Quality of Life Policies at the request of the committee on Economic and Monetary Affairs (ECON) ahead of the Monetary Dialogue with the ECB President on 27 September 2021.
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Joscha BECKMANN, Klaus-Jürgen GERN, Philipp HAUBER, Nils JANNSEN, Ulrich STOLZENBURG
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Publication type
Keyword
- consumer price
- coronavirus disease
- economic analysis
- economic conditions
- economic forecasting
- ECONOMICS
- ENERGY
- energy policy
- epidemic
- EU institutions and European civil service
- euro area
- European Central Bank
- EUROPEAN UNION
- FINANCE
- health
- inflation
- monetary relations
- price increase
- price of energy
- price stability
- prices
- SOCIAL QUESTIONS
- supply and demand
- trade
- TRADE