Since the introduction of the euro, average annual HICP inflation rate has been slightly above 2%, despite a succession of significant shocks (commodity and food prices in particular). Actual inflation may temporarily drift away from the central bank’s medium-term objective, notably due to significant commodity price shocks.
Average hourly earnings are experiencing the fastest rate of growth since 2009.6 Although data for the nal quarter is not yet available, underlying domestic demand – a measure of how much we consume and the government spends, and underlying investment – shows the economy grew by around 4 per cent last year.