Inflation in the Eurozone at an all-time high: The Russian oil embargo will push it further

Eurozone inflation broke a record, rising to 8.1% in May from 7.4% in April. CPI rose 0.8% monthly, well above expectations. Inflation reached historic highs in

countries in the region Germany , France , Italy and Spain .

Inflation, which topped 3% in August, topped 5% in January and accelerated its rise over the past 5 months, reaching an all-time high of 8.1%. This rapid increase is due to the increase in energy prices, rising costs in all areas and continued consumption.

Production tends to slow due to rising input prices and renewed supply chain problems. Meanwhile, the EU ban on Russian oil risks putting further pressure on soaring prices as the war disrupts supplies of wheat and fertilizers.

Current inflation is well above the European Central Bank’s 2% inflation target over the medium term, which also strengthens the Bank’s possibility of making a move before July .

Statements by the authorities point to a gradual hike in interest rates in July, but it is believed that a late and limited move to sharply worsen inflation will also be ineffective.

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