Eurozone Inflation Reaches Record 7. 1% in May

Fallout from COVID policies working economies across globe

Inflation in the 19 countries from the eurozone soared to eight. 1% in May from seven. 4% in April, numbers showed on Tuesday, going above previous expections.  

Prices have risen sharply in  yesteryear year, initially because of supply chain problems after the COVID pandemic but subsequently  because of Russia’s invasion of Ukraine.

How do the figures break down?

Energy prices jumped leaped by 39. 2% because of a global  energy crisis caused by  the battle.  

Foods prices soared by 7. 5%, while prices with regard to other goods — such as clothing, appliances, cars, computers and books  — were up 4. 2% and the cost for services went up 3. 5%.

Germany’s inflation rate achieved 7. 9% in May, based on data published on Mon by the German statistical company Destatis.

Inflation in the eurozone — home to some 343 million people. — is now at its highest since records for your currency began in 1997.

Rise in interest rates on the cards

To tame price rises, the European Central Bank has already flagged up a 25 basis point increase  in its minus 0. 5% deposit rate in both This summer and September.  

Early in May, the  US Federal Reserve raised interest rates  by fifty percent a percentage point for the first time since 2000 in a bid to combat soaring inflation.

That came simultaneously the Bank of England  raised its interest rates to a 13-year high.

Worries of an upward  price spiral

The latest numbers mean headline inflation has become 4 times the ECB’s 2% target, and there are concerns that the rapid rise in root prices could see pumpiing become embedded.

That means prices would continue to spiral  as prices plus wages become locked in to a pattern of mutual escalation.  

The release of the figures coincided with data showing that France’s economy shrank in the initial quarter.

A good EU decision on Monday  to  immediately halt two-thirds of Russia’s oil exports  to the bloc could put still more upward stress on prices.

If we are unwilling to come together and legitimately police our elected market leaders then we all don’t deserve freedom.

Leave a Reply

Your email address will not be published. Required fields are marked *