Italian inflation fell by half a percentage point in July. A contraction expected, and even slightly higher than expected: 5.9% y/y against 6% forecast and down from 6.4% for June. The point is, however, that consumers won’t even notice. Indeed, prices have remained stable and increases continue to have a strong impact on household budgets.
In any case, analysts say something is moving. For example, the upward trend in household and per capita food prices, which in July was +10.2% y/y, compared to +10.5% in June, is slowing. “We must and we can do more,” said the Minister of Enterprise, Adolfo Urso, referring to the way in which the anti-inflation protocol signed with distribution organizations, artisans, cooperatives and SMEs, will reveal its effects from October 1 to December 31, by “controlling basket of consumer products. According to Luigi Scordamaglia of Filiera Italia, “The only way to counter the decline in purchasing power is to find a higher net salary”.
Then, if Athens cries, Sparta does not laugh. Even abroad, in fact, after twelve consecutive months of decline, inflation rose to 3.2% in July, just one point below expectations. That’s enough to revive hope in markets that the Fed will again in September pause to raise interest rates, halting the cost of money while waiting to see if rates finally get on the right track.
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