FRANKFURT (Reuters) - House prices, now excluded from euro zone inflation data, would have persistently raised consumer prices in recent years, a study published by the European Central Bank showed on Tuesday, highlighting policymakers’ unease with the current indicator.
REUTERS/Axel SchmidtOnce corrected for housing costs, euro zone inflation would have hit or even exceeded the ECB’s target some years, even as the bank was providing extraordinary stimulus to raise prices, figures from the study showed.
Although the ECB does not calculate inflation data, it said in July that it would consider estimates on the cost of owner-occupied housing on inflation until Eurostat, the EU’s statistics agency, fixes the broader measure.
Graphic: Euro yone inflation corrected for house price growth:Over two decades, however, the adjusted inflation figure would have been little different, the study argued, as housing costs could have been a drag on prices.
The paper added that experimental, quarterly inflation figures with housing included could be published in 2023 while official quarterly data are not expected until 2026.
Axel Schmidt, “
European Central Bank, REUTERS, ECB
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