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Euro zone inflation remains modest

16 Dec 2012 by Jim Fickett.

Eurostat recently reported price indices through November. Headline inflation is at 2.2% and core inflation (less energy and unprocessed food) is at 1.6%:

The ECB main refinancing rate stands at 0.75%, putting the real European short-term rate at -1.45%. In the US, the most recent overnight trading rate in the Federal Funds market was 0.16%, and headline inflation was last reported at 1.8%, giving a real short-term rate of -1.64%. Within the likely error of measurement, then, financial repression is about the same in Europe and the US.

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