🧵Inflation is expected to be higher and more persistent in the United States than in the euro area over the next two years despite headline inflation rate, driven mainly by food and energy prices rising more in the euro area recently https://www.ecb.europa.eu/pub/economic-bulletin/focus/2023/html/ecb.ebbox202208_01~c11d09d5fd.en.html #EconomicBulletin
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The euro area is highly exposed to energy shocks related to the war in Ukraine. Therefore, headline inflation is expected to remain higher in the euro area in the short term, despite the weaker economic outlook
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Yet inflation is expected to be higher in the United States over the coming two years. Above-target levels of inflation are expected to be more persistent in the United States, which may reflect the larger impact of domestic factors on inflation there
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