Inflation forecasts have been made for the coming months. We all expect inflation to accelerate in the euro area.
Forecasts announce the increase in inflation up to the peak of 11.2% year on year and the core one of 5.3% year on year. Markets expect November headline inflation to be 10.4% yoy. Core inflation stands at 5.3% yoy and over the course of 2023 will decrease to 3.2% by October 2023.
The analytical study carried out on inflation therefore claims that it reaches its peak in December in the euro area. Unlike the markets and the consensus, which believe that the peak is behind us. The phenomenon of inflation is also characterized by the continuous surprises of energy prices . Producer price data suggests a rude awakening. Although it is not known how much these price pressures will affect inflation. An increasing number of items in the basket show ever higher inflation.
The inflation rate must come down and not reach the forecast of 15% in Europe . Monthly price growth must therefore be lower than it was a year ago. The price increase in 2022 was really high, so the bar isn’t high to see annual inflation come down. However, monthly price growth remains exceptionally high. The key to everything therefore is to wait for the monthly price increase to settle at a consistent ECB rate of 2% per annum.
- Could inflation reach 15% in Europe? (wallstreetitalia.com)