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Euro Area Inflation and how Import Prices, Profits, and Wages fit in

IMF Podcasts

CHAPTER

The ECB's Inflation Targets

The ECB has been talking about getting it back down to 2% by 2025. So when you look at corporate profitability and the scenario with wages and the whole labor aspect of this, what are corporations going to need to do to make that 2% target by 2025? Right. We can use the framework we have where we decompose inflation into import costs, profits and wage growth. Ask what would it need for a certain inflation path in terms of those components? And we know import prices are going to help.

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