Beware of the seasonal effects in inflation data

Data released this week showed that the headline inflation rate in the euro-zone fell in March, to 2.4%, but that prices rose by 0.8% a monthly basis. However, the increase in prices was largely due to seasonal effects and so not a concern for policymakers. Meanwhile, the Riksbank’s Governor Erik Thedéen asked the Swedish parliament this week for a capital injection largely to cover losses of its asset purchase programme. This may make the Bank think twice before adopting QE again in the future.