Energy pushes headline inflation higher, core measures are still contained
Key takeaways
1. A rise in inflation still confined to energy – Rising energy prices are pushing inflation higher in Europe and the United States, while energy’s contribution is slightly negative in Japan.
2. Some recent pressure on core measures – Over recent months (3m/3m), core indices have been firming in the euro area and Japan: a signal to watch.
3. Mounting pressure on producer prices – In Europe and Japan, pressure on producer prices is building. The risk of the energy shock spilling over to other CPI items is increasing.
4. Rising short-term market expectations – Markets (swaps) are pricing this rise in inflation into short-term measures. Long-term expectations (5y5y) are rising in Japan and the UK.
Author
BNP Paribas Team
BNP Paribas
BNP Paribas Economic Research Department is a worldwide function, part of Corporate and Investment Banking, at the service of both the Bank and its customers.
