Deflation is coming : economic perspectives for the euro area and euro area countries in 2014,2015,2016

Xavier Timbeau (1) , Lars Anderson , Christophe Blot (1) , Jérôme Creel (1) , Andrew Watt

1 OFCE - Observatoire français des conjonctures économiques (Sciences Po)

Six years after the start of the Great Recession, the economic and socialsituation in the euro area is still depressed and fragile as shown by key macroeco-nomic indicators. Growth will not exceed 0.8% in 2014 after two consecutiveyears of recession. The risk of deflation is increasing as inflation has now been below 0.5% since May 2014.Employment has improved moderately but unemployment remains at an unacceptably high level. Consequently, inequality andthe risk of poverty are increasing significantly. In short the euro area still suffers the aftermath of the crisis and has not yet engaged in a buoyant recovery.

Keywords: deflation; economic perspectives; the euro area

Domains: Humanities and Social Sciences; Economics and Finance

Xavier Timbeau, Lars Anderson, Christophe Blot, Jérôme Creel, Andrew Watt. Deflation is coming : economic perspectives for the euro area and euro area countries in 2014,2015,2016: Chapter 1. Revue de l'OFCE, 2015, IAGS 2015, pp.19 - 68. ⟨hal-03460032⟩