Foto: Zane Bitere, LETA
With me, they are. And perhaps they should change that sentence on their web site in the bottom right corner. Ouch! – after the Eurozone inflation rate in December 2021 beat its all time high, set in November 2021, that beat its all-time high set in October 2021, inflation in January 2022 set yet a new Eurozone record, at 5.1%, see Figure 1. The ECB’s medium term target of 2% seems very far away…
The ECB, however, still believes that inflation at the end of this year will be just 1.9%. Hmmm… They were not exactly right in terms of their expectations for Q4 2021 (same link), which were 2.3%.
In a recent post I criticized monetary policy of the ECB; here, I am happy to make a few more such arguments for why I think monetary policy is far too loose in the Eurozone.
Figure 1: Inflation in the Euro area, 1999-I – 2022-I
