Global| Apr 16 2008Already High, Euro Area Inflation is Revised Up
Summary
Euro Area inflation was revised higher in March and now is expanding at a 3.6% annual rate, not quite as fast as the universe, but fast enough to create a gnashing of teeth at the ECB. Yesterday, Juergen Stark of the ECB said that [...]
Euro Area inflation was revised higher in March and now is
expanding at a 3.6% annual rate, not quite as fast as the universe, but
fast enough to create a gnashing of teeth at the ECB. Yesterday,
Juergen Stark of the ECB said that current policy may not be enough to
hold medium term prices stability in line. Among the four largest EMU
economies, core inflation is over the 2% inflation ceiling, ranging
from a 2.4% yr/yr pace in Germany to a 3.5% pace in Spain. France an
Italy are seeing their respective core inflation rates accelerated from
12 months, to 6 months to, 3 months. Now those are not good trends at
all. Germany’s core inflation acceleration broke off from six months to
three months, as the three month rate has dropped back to 1.9%. In
Spain the three month rate fell back to 3.1% from 4.2% over six months.
Within EMU as a whole core inflation is still accelerating,
with the 3-month pace up to 3.4%.
| Trends in HICP | |||||||
|---|---|---|---|---|---|---|---|
| % mo/mo | % saar | ||||||
| Mar-08 | Feb-08 | Jan-08 | 3-Mo | 6-Mo | 12-Mo | Yr Ago | |
| EMU-13 | 0.5% | 0.3% | 0.3% | 4.1% | 4.8% | 3.6% | 2.0% |
| Core | 0.4% | 0.3% | 0.1% | 3.4% | 3.3% | 2.7% | 1.9% |
| Goods | 1.4% | 0.3% | -0.5% | 4.5% | 6.1% | 4.1% | 1.7% |
| Services | 0.4% | 0.5% | -0.2% | 2.8% | 3.0% | 2.8% | 2.4% |
| HICP | |||||||
| Germany | 0.4% | 0.3% | 0.3% | 3.8% | 3.9% | 3.3% | 2.1% |
| France | 0.5% | 0.0% | 0.3% | 3.5% | 4.8% | 3.5% | 1.2% |
| Italy | 0.6% | 0.6% | 0.1% | 5.0% | 5.2% | 3.6% | 2.1% |
| Spain | 0.4% | 0.4% | 0.2% | 4.1% | 6.2% | 4.6% | 2.5% |
| Core excl Food, Energy and Alcohol | |||||||
| Germany | 0.4% | 0.3% | -0.2% | 1.9% | 2.5% | 2.4% | 1.7% |
| France | 0.4% | 0.1% | 0.3% | 3.2% | 3.1% | 2.5% | 1.3% |
| Italy | 0.7% | 0.4% | 0.0% | 4.3% | 4.1% | 2.9% | 2.0% |
| Spain | 0.3% | 0.3% | 0.2% | 3.1% | 4.2% | 3.5% | 2.5% |
Robert Brusca
AuthorMore in Author Profile »Robert A. Brusca is Chief Economist of Fact and Opinion Economics, a consulting firm he founded in Manhattan. He has been an economist on Wall Street for over 25 years. He has visited central banking and large institutional clients in over 30 countries in his career as an economist. Mr. Brusca was a Divisional Research Chief at the Federal Reserve Bank of NY (Chief of the International Financial markets Division), a Fed Watcher at Irving Trust and Chief Economist at Nikko Securities International. He is widely quoted and appears in various media. Mr. Brusca holds an MA and Ph.D. in economics from Michigan State University and a BA in Economics from the University of Michigan. His research pursues his strong interests in non aligned policy economics as well as international economics. FAO Economics’ research targets investors to assist them in making better investment decisions in stocks, bonds and in a variety of international assets. The company does not manage money and has no conflicts in giving economic advice.
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