Thomas BabychanInflation is not showing any signs of respite in the European Union as consumer prices shot up annually by 10% in the month of September 2022. Countries belonging to the European Union are witnessing record levels of inflation and increase in consumer price index as Russian invasion of Ukraine is continuing in full swing.
According to latest numbers released by European commission, nations which are using Euro as their main currency witnessed consumer price index rise by 10% in September when compared to last year. Past reports and general statistics suggests that the current levels of inflation are highest since the creation of Euro in 1999.
Consumer Price Index rose by 9.1% annually in month of August 2022 which was at that time the record inflation rate in the history of European Union. The increasing prices of essential commodities in the European markets shows that slowing down of oil prices internationally and such moves have not helped the European economy.
Energy prices saw the highest jump in Europe as the consumer price index posted a 40.8 per cent annual jump in the prices of energy commodities. Similar to energy prices, cost of food also increased by 11.8 percent in September 2022. On August 2022, food prices CPI was standing at 10.6 per cent annually.
The economic report released by European commission states that 10 out of 19 countries in the eurozone posted overall inflation at double digits in the month of September. The countries which witnessed double digit inflation rate includes Germany and Netherlands, two major developed economies in the European Union. Germany which is the largest economy in the eurozone has been struggling with high inflation rates for the past few months. All the macroeconomic decisions taken by Germany has rem,ainedf futile till this point in controlling high inflation rates.
World in general and European Union in particular has been witnessing historically high inflation rates for past few months as Russian special military operation in Ukraine created severe energy crisis in the European nations. Decision of the Russian government to cut of gas and oil supply to Europe acted as the major reason for hikes in commodity prices.
As the demand for oil and gas increased internationally, prices for those commodities rose alongside. That had a domino effect of other essential commodities such as food and clothing. The global supply chain crisis triggered by COVID-19 pandemic and china USA trade war also played a major role in intensifying impacts of inflation on the European economies.