The European Central Bank (ECB) revised its forward guidance, indicating it would keep interest rates “at their present or lower levels until it sees inflation reaching 2% well ahead of the end of its projection horizon and durably for the rest of the projection horizon, and it judges that realised progress in underlying inflation is sufficiently advanced to be consistent with inflation stabilising at 2% over the medium term.” The ECB indicated that this process could involve a short period in which inflation goes moderately above this target.
Inflation bubbling up
Consumer prices in America rose 5.4%, well above expectations. There are a small number of huge price rises, such as used cars, whereas the median price change is far lower.
In the UK CPI rose 2.5%. The Office for National Statistics cited increased prices for food, fuel, second-hand cars, clothing and footwear as key factors.