2022-03-28-牛津经济研究院-Eurozone_Inflation_to_take_a_toll_on_consumer_spending_growth_6页_318kb

Consumer spending in the Eurozone is expected to rebound in Q2 2022 following the Omicron wave, with a forecast of 4.7% growth for the year, down from a previous estimate. However, rising inflation, particularly due to energy and food price hikes from the Ukraine invasion, is expected to reduce real incomes and erode purchasing power, especially for lower-income households. This uneven impact calls for targeted fiscal support. High-frequency data indicate a swift recovery, but persistent inflation may delay full pent-up demand fulfillment from pandemic-related constraints. Excess savings are crucial but are being depleted by inflation, prompting households to shift funds into less liquid assets. The report concludes that demand-side rebalancing and supply improvements could alleviate some inflationary pressures, but risks remain for uneven consumption growth.