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High inflation forces Europeans to cut down expenses
16 May 2008The European Union has for a long time been considered as commonwealth of 27 stably developing states with a good parameter of gross national product and low rate of inflation. From year to year salaries of Europeans grew, and their purchasing capacity grew in this connection.
However now, on a background of a sharp rise in prices on the foodstuffs and power resources Europeans are compelled to cut down the charges and to save. The situation is aggravated also with that fact, that many manufacturers raise the prices for the goods because of growth of production costs.
Large food stuffs and household chemical goods manufacturers, such as Nestle and Unilever, have already raised the prices for production, trying though somehow to compensate prompt growth of production costs. However, experts mark, that consumers will eternally not suffer this rise in price, and finally can simply start to buy production of other, less known, companies.
Anyway, so sharp rise in prices has already led to the fact that Europeans have started to cut down the expenses - in UBS economists’ opinion, this year net profits of citizens of the European Union will be reduced for the first time for the long period of time. And Germany, Italy and Spain will suffer more than the other EU countries. Statistics confirms this point of view: on preliminary data of European statistical agency Eurostat, volume of retail trade in Eurozone of the reference of uniform European currency in March, 2008, has decreased on 0,4 %.
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