ECB's Relative Comfort from Restrained Pass-Through of Energy Shock Could be at Risk

Dow Jones
08/21

0516 GMT - Up to now, European Central Bank policymakers are likely to have taken some comfort from the relatively restrained indirect pass-through of the energy shock to prices of other items, Daiwa Capital Markets analysts say in a note. "Certainly, pressures have been largely concentrated in the early stages of the production chain and in sectors most exposed to prices of hydrocarbons," they say. But with wholesale oil and gas prices having shifted higher again in recent weeks, so too have risks that indirect and second-round price effects will become steadily more pronounced and long-lasting, they say.

 

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