Europe headline inflation

Signs of a future increase in inflation

The Impact Of The COVID-19 Outbreak On European Inflation

CaixaBank Research | The impact of the coronavirus on inflation is uncertain, as there are simultaneous supply and demand movements that can tilt the balance towards more inflation, disinflation, or even deflation. In the short term, despite measurement problems and the closure of markets, disinflation has dominated. In the medium term, several factors suggest that disinflationary pressures will continue to dominate. In the long term, transformations such as deglobalisation or shifts in consumption patterns could lead to structural changes.