Recent elections in France, Greece and Italy have shown a very clear message from European citizens to their leaders. Enough with austerity measures and strict budget cuts, Europe needs to grow immediately. Yet the day has come for Europe to change the direction as Germany seems to be more willing to raise its inflation.
Germany as the biggest EU economy has always been very cautious about inflation due to the historical experience. But the fear of another profound recession has become even bigger. Earlier goal of the ECB to keep inflation under 2 % is unlikely to be reached and is to be redefined in favour of new growth policies. Euro area annual inflation was 2.6 % in April 2012 and the EU annual inflation was 2.7 %.
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For more about Germany and inflation, click here (article in German).
2nd May 2018