Persistence of the adverse effects of war over time
ENERGY SUPPLY DISRUPTIONS AND PRICE INCREASES DUE TO THE EU IMPORT EMBARGO AND RUSSIA’S EVENTUAL DECISION TO UNILATERALLY CUT OFF SUPPLIES TO EUROPE
An embargo on European imports of fossil fuels from Russia would affect all sectors
Potential impact of the Russian gas supply cut-off, 2023
Russian gas import substitution until May 2022
DISRUPTIONS IN THE SUPPLY CHAIN OF RAW MATERIALS DUE TO THE IMPACT OF THE WAR TRIGGER DOMINO EFFECTS IN CRITICAL INDUSTRIES, SUCH AS THE AUTOMOTIVE INDUSTRY, ESPECIALLY ELECTRIC VEHICLES
Russia accounts for 25% of world exports of palladium and nickel, key to the automotive industry
Ukraine, a key exporter of neon, essential in semiconductor manufacturing
Stronger and more lasting inflationary pressures than expected
IN THE ABOVE CONTEXT, THE INCREASE IN PRODUCER PRICES IS PASSED ON TO CONSUMER SELLING PRICES
Rising inflationary pressures in the Eurozone already started before the war
Producer prices have grown faster than consumer prices
CPI inflation outlook depends on producer price developments