- 9 November 2022
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 7, 2022Details
- This box examines the impact of the recent rise in inflation on low-income households in the euro area. Low-income households face significantly higher effective inflation rates than high-income households, due to a different composition of their consumption basket. Moreover, they are more liquidity-constrained and have less room to buffer sharp increases in their cost of living. Survey-based evidence shows that low-income households perceive the recent government measures aimed at easing the burden of higher energy prices as less adequate than high-income households do. This could suggest that there is potential for government support measures to be more targeted towards low-income households.
- JEL Code
- E31 : Macroeconomics and Monetary Economics→Prices, Business Fluctuations, and Cycles→Price Level, Inflation, Deflation
E21 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Consumption, Saving, Wealth