Chart of the Day: Eurozone Inflation Edging Close to Zero


Hyperinflation is right around the corner! Oh, wait:

Consumer prices in the euro zone ticked ever closer to outright deflation, official data showed Tuesday, making it almost certain that the European Central Bank will move to ease monetary policy this week….Many economists say that inflation is already well below the danger zone for tipping into deflation, and some analysts have taken to calling the condition “lowflation.”

….The Governing Council of the European Central Bank, which meets Thursday, targets an inflation rate of just below 2 percent, a level that it has been undershooting for months. Adding to the pressure, a separate report showed the European labor market continuing to stagnate. The euro zone jobless rate came in at 11.7 percent in April, ticking down marginally from 11.8 percent in March, Eurostat said.

And what is the ECB planning to do about this? According to Gilles Moëc, the chief Europe economist for Deutsche Bank, “investors might be surprised to find that the scale of the central bank’s actions would probably be significantly smaller than those taken by other central banks, including the Federal Reserve in the United States.” That makes sense. After all, with unemployment at 11.8 percent and inflation close to zero, you can’t be too careful. One wrong move and inflation might skyrocket to 1 percent. And then where would we be?

BEFORE YOU CLICK AWAY!

“Lying.” “Disgusting.” “Scum.” “Slime.” “Corrupt.” “Enemy of the people.” Donald Trump has always made clear what he thinks of journalists. And it’s plain now that his administration intends to do everything it can to stop journalists from reporting things they don’t like—which is most things that are true.

No one gets to tell Mother Jones what to publish or not publish, because no one owns our fiercely independent newsroom. But that also means we need to directly raise the resources it takes to keep our journalism alive. There’s only one way for that to happen, and it’s readers like you stepping up. Please help with a donation today if you can—even a few bucks will make a real difference. A monthly gift would be incredible.

payment methods

BEFORE YOU CLICK AWAY!

“Lying.” “Disgusting.” “Scum.” “Slime.” “Corrupt.” “Enemy of the people.” Donald Trump has always made clear what he thinks of journalists. And it’s plain now that his administration intends to do everything it can to stop journalists from reporting things they don’t like—which is most things that are true.

No one gets to tell Mother Jones what to publish or not publish, because no one owns our fiercely independent newsroom. But that also means we need to directly raise the resources it takes to keep our journalism alive. There’s only one way for that to happen, and it’s readers like you stepping up. Please help with a donation today if you can—even a few bucks will make a real difference. A monthly gift would be incredible.

payment methods

We Recommend

Latest

Sign up for our free newsletter

Subscribe to the Mother Jones Daily to have our top stories delivered directly to your inbox.

Get our award-winning magazine

Save big on a full year of investigations, ideas, and insights.

Subscribe

Support our journalism

Help Mother Jones' reporters dig deep with a tax-deductible donation.

Donate