OeNB: CO2 pricing increases inflation by 0.1 to 0.2 percentage points
Rising energy prices and bottlenecks in supply will ensure that inflation (HICP) will rise to 3.2 percent this year, the Oesterreichische Nationalbank (OeNB) expects.
Not until 2024 is inflation likely to return to the ECB’s target of 2.0 percent. However, CO2 pricing is only responsible for a very small part of the price increases – it will only add 0.1 to 0.2 percentage points to inflation, according to the publication series “Inflation aktuell”.
The year 2021 brought an increase in the Harmonized Index of Consumer Prices (HICP) of 2.8 percent in Austria, in the fourth quarter of 2021 alone the inflation rate measured in this way was 3.9 percent. That was the highest value since the beginning of monetary union. About two thirds of the increase since the beginning of 2021 were due to the rise in energy prices, writes the OeNB.
“The rise in inflation in the course of 2021 was largely due to the rise in crude oil prices, but gas and electricity prices have also increased significantly in recent months,” said the OeNB. The global economic recovery led to strong demand with simultaneous problems on the supply side, which also made many non-energy raw materials more expensive. “This was increasingly reflected in the end-user prices of durable consumer goods.” But there have also been exceptionally high price increases in tourism and thus a rise in service inflation.
tsk / cgh