Consumer Price Stickiness in the Euro Area During an Inflation Surge

Summary

Using 190 million price quotes from 9 euro-area countries, the paper shows prices changed more often during the inflation surge: about 8 % per month in 2010–2019, 12 % in 2022, and nearly 16 % in Jan 2023. Most of the rise came from more price increases. This implies a more flexible economy, with inflation responding faster when shocks are large.

Highlights

Scale matters
We use a micro CPI dataset with 190 million price quotes from 9 euro-area countries. 

What changed
Monthly price changes rose from about 8% (2010–2019) to 12% in 2022, peaking near 16% in Jan 2023. 

Why it matters
The increase in inflation came mainly from more price rises (not bigger jumps); it eased in 2023–24, though services stayed higher for longer.