Global Macro Service > Research Briefings > Eurozone

Why January’s inflation jump won’t scare the ECB

With January’s detailed inflation report showing that transitory factors caused much of the month’s surprisingly large rise, a partial retracement is possible in February. In addition, we don’t find signs of a big jump in underlying inflation. And while we still expect inflation to recover strongly this year from 2020’s extreme lows, fuelling the reflation will mostly be base effects and higher energy prices. We continue to think the ECB will look through this.

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