The President of the European Central Bank (ECB), Mario Draghi, believes there is no evidence that e-commerce is burden for inflation in the Eurozone. His comment comes as part of the debate among leading economists whether online giants, such as Amazon and Alibaba, have an impact on inflation in major economies in Europe and the US, because of their ability to undercut the prices of traditional retailers and their physical stores.
Mario Draghi is not convinced that online retailers have a “significant” effect.
Some economists are blaming Amazon and other online giants, believing that structural changes due to globalization and digitization make it difficult for central banks to hold back domestic inflation. However, the President of the European Central Bank refused this.
“We do not see much evidence suggesting that e-commerce in the Eurozone today is suppressing inflation – at least as much as we can measure it, and so is the global weakening”, said Mario Draghi. “Indeed, as the global economy is recovering, the foreign production is moving in the same direction as Eurozone output”, added he.
Thursday’s data confirmed that core inflation, excluding energy and food, reached 1.1% in October. The ECB’s goal is to bring it closer to 2%.
According to Mario Draghi, the central bank must be “patient and persistent” to inflation to return it to the 2% stake.