As experts rave that the ECB is downplaying the issue, the Eurozone is seeing its greatest inflation in 13 years.

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As experts rave that the ECB is downplaying the issue, the Eurozone is seeing its greatest inflation in 13 years.

Inflation rates in the Eurozone continue to rise, with prices rising at their quickest rate in 13 years in September.

According to the European Union’s Eurostat statistics department, consumer prices increased by 3.4 percent year on year in September. The news is another another setback for Eurozone consumers, who saw prices rise 3% year on year last month, the highest level in a decade. As economies recover from the coronavirus pandemic, the yearly inflation rate has accelerated, indicating further evidence of pricing pressures.

The data is also expected to give policymakers at the European Central Bank a headache as they try to figure out how to get the 19-nation currency bloc back on track.

The 3.4 percent gain from the previous year is the most since September 2008, and it exceeds analyst expectations of a 3.3 percent increase.

The majority of the price increase was due to an increase in energy prices, which was driven by a reversal of the oil price fall that occurred during the COVID-19 epidemic.

However, there was an impact on production and shipping delays, with durable goods seeing a 2.3 percent price increase from August.

With rising natural gas prices and ongoing delays affecting industries ranging from automobile manufacture to computer manufacturing, inflation might reach 4% by the end of the year.

Before what the Frankfurt-based bank expects to be a fast fall in early 2022, such a spike would be twice the ECB’s aim.

However, supply chain disruptions look to be deepening, increasing the likelihood that the inflation hump filters into underlying prices and causes greater long-term pressures as businesses modify their pricing and wage policies.

The ECB is expected to maintain its view that the inflation shock will fade swiftly and that price rise will remain below target for many years.

This week, ECB President Christine Lagarde took a cautious stance, stating that heightened inflation concerns require patience and cautioning against overreaction.

Central bankers, according to market experts, are underestimating the risk of inflation.

“We think there are significant odds that current inflation is less transitory than other central banks, including the ECB, are suggesting,” BNP Paribas economist Luigi Speranza said.

“Consumers may begin to demand greater wages, and businesses may comply on the theory that higher costs can be passed on to consumers in the form of higher ultimate prices.”

“The latest spike will do very little to bridge the divide between the two inflation camps: one saying that inflation. “Brinkwire Summary News,” said Carsten Brzeski, global head of macro at ING Germany.

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