Inflation is spiraling out of control

Inflation is spiraling out of control

The last time inflation was in the double digits was back in February 1995, but that 27-year record is likely to be broken this week.

The Hellenic Statistical Authority (ELSTAT) is set to announce the rise of the consumer price index to a historic high, posting annual growth in excess of 10% last month for the first time in 28 years, as inflation is proving much more resilient than expected to date.

Given that the European Union-harmonized inflation rate was at 9.3% in April, the figure that ELSTAT is set to publish on Tuesday will likely be in the double digits and there is no deceleration anticipated in May either.

Such is the extent of the problem, according to government estimates, that the entire package of 3.2 billion euros against the electricity rate hikes announced last week will only contain inflation by half a percentage point.

Government officials expect the above intervention to contain the year’s average price growth rate around 5%-6%, although the slide of the euro will mathematically lead to further hikes, especially in gasoline and diesel as well a series of other imported commodities that depend on the exchange rate of the common currency.

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