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Are markets signalling that the risk of deflation is over?
[Les marchés signalent-ils la fin du risque de déflation ?]

Author

Listed:
  • Hervé Le Bihan
  • Imène Rahmouni Rousseau

Abstract

Financial markets confirm that, since autumn 2016, deflationary risks in the euro area have dissipated. Market indicators – which are admittedly susceptible to a number of biases – nevertheless continue to reflect medium-term inflation expectations which are below the Eurosystem’s target (inflation rates of below, but close to, 2% over the medium run). Les marchés financiers confirment que, depuis l’automne 2016, les risques de déflation se sont dissipés en zone euro. Les indicateurs – certes sujets à de nombreux biais - continuent toutefois à refléter des anticipations d’inflation plus basses à moyen terme que la cible d’inflation de l’Eurosystème (une inflation inférieure à, mais proche de, 2%).

Suggested Citation

  • Hervé Le Bihan & Imène Rahmouni Rousseau, 2017. "Are markets signalling that the risk of deflation is over? [Les marchés signalent-ils la fin du risque de déflation ?]," Eco Notepad (in progress) 24, Banque de France.
  • Handle: RePEc:bfr:econot:24
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