Where is the Euro Area headed? Restoration of price stability

After the two recent global shocks of the COVID-19 Pandemic of 2019-2021 and the Russian invasion of Ukraine in February 2022, the 2023-24 economic priority for the Euro Area is the fight against inflation in the midst of global economic and financial uncertainties. We focus on Euro Area inflation, analyze its diagnostics, examine inflation expectations, review theories of inflation and evaluate monetary and fiscal policies prompted because of COVID-19. Then we explore policies of the European Central Bank to fight inflation and conclude that restoration of price stability in the Euro Area will remain its central focus during 2023 and 2024.(c) 2023 The Society for Policy Modeling. Published by Elsevier Inc. All rights reserved.

Automated summary

This article discusses the economic priority of fighting inflation in the Euro Area during 2023-2024, and analyzes and evaluates the inflation issues in the region, as well as introduces the policies of the European Central Bank.