Inflation in Europe at levels not seen since the creation of the euro zone
Volunteers during a food distribution to students strangled by the rising cost of living.
Bordeaux, November 15, 2022. AFP - PHILIPPE LOPEZ
Text by: RFI Follow
3 mins
In Europe, inflation is not weakening.
The rise in prices spares no country, from Spain to Sweden via Hungary.
In France, for example, it accelerated to 7.2% over one year in February.
A bad economic climate for business, which raises fears of a new intervention by the European Central Bank.
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Since its creation twenty years ago, the euro zone has never experienced such inflation.
Driven by the food and energy sectors, the rise in prices took hold throughout the European continent.
The strong economies are affected, this is the case of France, but also of Germany (9.2% in January), Italy a (10.7% last month) or, outside the EU, UK where food prices soared by 17%.
But it is the Eastern European countries that are suffering the most.
In January, inflation reached 18.6% in Estonia, 21.4% in Latvia, and even 26.2% in Hungary.
Some countries are now entering recession, such as Finland and Sweden.
As a result, investors are worried since the European Central Bank (ECB) could further increase its key rates in an attempt to curb this inflation.
A fear felt on the financial markets, and even on the price of gold.
For Denis Ferrand, director of the Coe Rexecode firm, we are at the end of the first wave of inflation linked to the consequences of Covid and its shortage phenomena which have caused basic products and industrial products to rise.
Wave which has amplified with the conflict in Ukraine.
At the same time, the second phase is taking shape, which relates to a propagation effect.
What remains of this first phase is the fact that inflation is in the process of deflecting, a lot, on the prices of food products, with a circumstance which is very particular in Europe, which is the fact that the shock of energy prices related in particular to the price of electricity and the price of gas.
However, the prices of electricity and gas are not like the price of oil, they do not react immediately.
It reacts as and when the gas and electricity supply contracts signed by the companies expire.
Denis Ferrand, director of the firm Coe Rexecode, reacts to the levels of inflation in Europe
Patricia Lecompte
In France, according to data from INSEE, the National Institute of Statistics and Economic Studies, inflation accelerated in February to +6.2% over one year, after a slowdown in December and January.
In harmonized data, used for comparisons on a European scale, the consumer price index stands at 7.2%, a record.
The energy reaches peaks;
food is expected to increase further in March.
Everything has increased.
You see, you buy fuel for the tractor, it's doubled;
as soon as we go to get a spare part, all that;
transportation, delivery, huge bills coming in;
and behind, even having increased the price of meat, it still does not compensate.
We see at home in the countryside of Giers, the farms are closing day by day.
Where will it stop?
Report at the Agricultural Show: they also benefit from the price increase, but remain caught by the throat
Alexis Bedu
► To read also: In France, further acceleration of inflation
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