Eurozone Inflation: energy impact still lies ahead - delano.lu

Lionel De Broux, chief investment officer, and Jade Marie Bajai, investment strategist at Bil. (Photo: Bil) The Eurozone has so far weathered the energy shock surprisingly well. Yet beneath the surface, rising fuel costs, weaker fiscal support and resilient growth suggest the ECB’s inflation battle is far from over. Despite the ongoing energy supply shock, inflation hasn’t been majorly problematic in the Eurozone so far this year. Inflation expectations, as measured by market break-evens, have remained relatively contained and investors initially treated the Middle East energy shock as a temporary event. However, the inflation backdrop is becoming increasingly challenging.