Friday, October 29, 2010

EU Inflation at 23 Month High

Annual consumer price inflation in the Eurozone  hit 1.9% in October, its highest level in 23 months, Eurostat reported today, citing preliminary estimates.

A more detailed breakdown will not be available until November 16.

This climb is despite the fact that the eoro has gained over 17% against the dollar since July.

Clearly, we are experiencing global inflation, partially the result of increasing demand from China. This should be another warning to Bernanke that he will be driving his inflation ship, the QE2, into very deep and global price inflationary activity.


  1. You'd think the Europeans would be better at fudging the inflation numbers to hide reality (like the Americans).

  2. Econophile breaks down the uptick in bank lending here: It is matched by the draw down in excess reserves. This will only become greater with QE2.

  3. Wenzel,

    I am not necessarily going to argue that we are not looking at global inflation, but I am becoming extremely concerned with the "lazy" use of the word inflation I have seen lately from you and other Austrians. You keep conflating price movements with changes in monetary aggregates.

    You know you could get price increases with falling supply of goods and services alone, right? Maybe the money supply is staying somewhat constant but as economic activity declines, there are less goods and services for currency to bid for and thus prices rise.

    I don't like the terms "price inflation" and "price deflation". I shed a tear everytime I hear an Austrian use one or the other.