Quarterly Monetary Policy Report, 2021/IV

The global and euro area economy continues to recover its economic activity, whereas inflation has accelerated. A wide range of factors such as: the easing of containment measures, the optimism of economic agents; and the continuous support of economic policies, has contributed to the global economic recovery at a pace faster than expected. On the other hand, the faster increase of demand has faced supply-side bottlenecks and logistical issues, driving to an increase in both the prices of raw materials and the costs of intermediate goods. In parallel to the stable increase of inflationary pressures, these shocks are expected to drive inflation above the target of central banks in the short run. Furthermore, as their effects wanes, inflation is anticipated to slow down.