Global Factors Account for Half of Inflation

Inflation continues to be driven to a large extent by commodity prices, which have recently risen strongly due to the price of natural gas. Half of inflation is caused by global demand impulses (upswing of the world economy) and global supply shocks (supply and delivery bottlenecks). In the USA, the recovery is already further advanced than in the euro area, and monetary policy there is increasingly being tightened. Austria recorded one of the sharpest GDP declines in the euro area in the fourth quarter of 2021 – as it did in the fourth quarter of 2020. However, the domestic labour market weathered the fourth lockdown largely unscathed. Particularly in the manufacturing sector, optimism prevails despite material shortages and recruitment difficulties.