Should the ECB worry about divergent inflation?
Economists say widening readings across eurozone show lingering effect of energy price shock
The European Central Bank (ECB) has reasons to be moderately optimistic about the inflation outlook. In July, headline inflation in the eurozone dipped to 5.3%, down from 8.9% a year before.
However, while inflation in some economies is close to the 2% target, in others it is way over it. For instance, Belgium recorded 1.7% headline inflation last month, and Spain 2.3%. In contrast, inflation in Germany stood at 6.5%, in France at 5.1%, and in Italy at 6.3%.
The ECB’s mandate targets the
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