Along with the increase of inflation in Poland and in the whole world, the discussion about its causes intensifies. There are many voices that the main reason is an external supply shock – the prices of energy and food. It is useful, in the analysis, to distinguish within CPI inflation, a core inflation and the rest of it. Core inflation is an inflation rate that is devoid of the most unstable components such as food and energy prices.
In this article we look at the connection between industrial and consumer prices in Bulgaria in an attempt to determine to what extent the industrial price index can be used to forecast the future dynamics of consumer inflation.
The solutions to combat inflation that Danuše Nerudová proposes are not good ones. A price cap on energy can lead to nothing but shortages. Financially incentivizing households and industry to reduce energy consumption is useless in a world of market prices.
In times of galloping inflation, the Polish government creates another inflation impulse – the “Coal allowance”, the payment of which is expected to cost as much as PLN 11.5 billion.
Every individual earns money for living somehow. The society agreed that the government is needed and this means we should pay money for their service, and we call it taxes. We may not like paying taxes, but we understand the need for the government to exist.
The conclusions of the ECB’s report is that establishing an environment that favors a steady convergence requires policies aiming at economic stability, as well as wide structural reforms. This statement holds regardless of whether we will adopt the Euro or not.
When we face serious problems, such as economic crises, the people, at least in France and Spain, prefer to leave the government in calmer hands – perhaps less charismatic, but better prepared.
One of the debates which has intensified recently is to what extent is lax monetary policy causing the increase in the price inflation.
The 20th anniversary of the euro was marked by an increase in price inflation. In the euro area, annual consumer price inflation reached 5% in December 2021. Lithuania recorded the highest rate of 11%.