In the United States, for example, consumer prices – based on a harmonised basket of goods and services – rose by 6% year-on-year in May, while they increased by only 2% in the euro area (right chart slide 2). Rising headline inflation reflects two complementary forces. The first is a strong rise in energy prices.
The recent experience may go some way to correcting this shortcoming, and make model-driven estimates more reliable in the future. This could in turn induce a significant change in the behaviour of investors for some time. (iv)  Value at risk (VaR)  Most financial firms use VaR and stress tests to measure market risks and assign position limits.