Eurozone Deflation Watch
There’s always “good news” from the European periphery where the cost of living is falling, falling, falling – every British politician’s dream (and they don’t even need price controls).
Looking at Eurozone macro data still feels a little like “rubbernecking”… but I’ve mastered Eurostat now, so here goes. Charts here show the headline HICP, the HICP at constant taxes (HICP-CT) and the HICP ex administered prices.
All three of the above have large “VAT wedges” since 2009.
In fact even the aggregate Eurozone HICP has a noticeable “VAT wedge” of its own, which I had not realised.