Supporting the deleveraging process in these ways – by raising real growth and working out private debt – would provide further momentum to the recovery, while raising confidence in long-term growth prospects. But importantly, balance sheet repair also creates the preconditions to address definitively one of the euro area’s key institutional weaknesses: the incomplete Banking Union.
The year-on-year rate of change in the consumer price index (CPI) for all items excluding fresh food has been at around 3 percent due to rises in prices of such items as energy, food, and durable goods. Regarding the outlook, it is likely to increase toward the end of this year due to such price rises.