Inflation is still not running out of steam. Some European countries have already published their level of inflation and they are reaching or flirting with the peaks.
Germany sets a record. Prices rose 7.9% year on year in May. This raises inflation to its highest level since the country’s reunification. To find such a rate, you have to go back to 1952 in West Germany. The harmonized price index, which serves as a benchmark at European level, rose 8.7% over one year, smashing the European Central Bank’s medium-term target of 2%.
Prices are notably pushed up by energy, which cost 38.3% more in May, and by food. All under the influence of the war in Ukraine. Added to this are the anti-Covid restriction measures in China which have increased the disruption of trade and supply chains.
Same causes, same effects in Spain where inflation accelerated again in May to reach 8.7%, despite a drop in electricity prices. The indicator excluding food and energy even posted its highest level since 1995.
Inflation close to 5% in France
In France, INSEE publishes its figures this Tuesday morning. But the Minister of Economy and Finance Bruno Le Maire anticipates a rate close to 5%. All the more reason, he assures us, to continue to contain the prices of electricity and gas, despite the additional funding to be provided for in the next budget.
This surge in prices puts the European Central Bank under a little more pressure, a week before a meeting to discuss the timing of monetary tightening. ECB President Christine Lagarde recently announced that she wants to raise rates from July, and is considering an exit from negative rates. by the end of the third quarter “.
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