Inflation stubborn in euro area

OECD Observer

Despite the economic slowdown, inflation in the euro area has remained stubbornly above the 2% level the European Central Bank considers to be consistent with price stability.

As the latest OECD Economic Outlook shows, inflation has remained persistent in the large, slower-growing economies, such as Germany and Italy. Inflation in these countries, though relatively low, has not declined sufficiently to offset higher rates of inflation in faster-growing economies, like Ireland.

This prevents the euro area-wide rate from falling. The OECD study points to various rigidities, which structural reforms to raise productivity growth would help to address.

©OECD Observer No 235, December 2002

Economic data

GDP growth: -1.8% Q1 2020/Q4 2019
Consumer price inflation: 0.9% Apr 2020 annual
Trade (G20): -4.3% exp, -3.9% imp, Q1 2020/Q4 2019
Unemployment: 8.4% Apr 2020
Last update: 9 July 2020

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