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27 Nov 2014
Eurozone at the roots of subdued inflation – BNP Paribas
FXStreet (Barcelona) - Clemente De Lucia of BNP Paribas notes the subdued inflation in Eurozone to be a case of concern.
Key Quotes
“Eurozone inflation continues to be a case of concern. While food and energy price developments largely contributed to the decline of inflation over recent months, the more domestically oriented core inflation is easing as well.”
“As the underlying pace of the recovery is still subdued, the output gap, which detects domestic price pressures, is likely to remain quite large and negative over the forecast horizon.”
“As the sensitivity of inflation to the output gap is increased, this rings other alarming bell in the eurozone and probably in Frankfurt.”
“Next week the ECB will join the club of those institutions which have drastically reduced their growth and inflation projections. This might open the doors to further actions from the central bank.”
Key Quotes
“Eurozone inflation continues to be a case of concern. While food and energy price developments largely contributed to the decline of inflation over recent months, the more domestically oriented core inflation is easing as well.”
“As the underlying pace of the recovery is still subdued, the output gap, which detects domestic price pressures, is likely to remain quite large and negative over the forecast horizon.”
“As the sensitivity of inflation to the output gap is increased, this rings other alarming bell in the eurozone and probably in Frankfurt.”
“Next week the ECB will join the club of those institutions which have drastically reduced their growth and inflation projections. This might open the doors to further actions from the central bank.”