Vienna, 26 July 2013 Press release

Lopatka: Shedding light on the darkness surrounding Euro confusion

Study demonstrates that Euro does not push inflation

Vienna, 26 July 2013 – "I have repeatedly said that the Euro does not push inflation. I therefore welcome the recent publication of a study that demonstrates that the Euro does not force prices up. While the years before the introduction of the Euro saw an average annual inflation rate of more than 5 percent (even 9.5% in 1974), the rate has improved to about 2 percent since the introduction of the Euro. These are known facts, but they are not put on the table often enough”, State Secretary Lopatka said in his comment on a policy brief published by the Austrian Society for European Politics (Österreichische Gesellschaft für Europapolitik, ÖGfE) under the title "Treibt der Euro die Inflation an? Die Fakten" (Does the Euro push inflation? The Facts). The policy brief also refers to the difference between real and perceived inflation and comes to the conclusion that international market developments have a stronger impact on inflation than the Euro. 

Lopatka added: "With all the negative headlines we read every day, I understand that people are worried about their jobs and the future of the Euro. We have to take these fears seriously and respond to them. But I simply refuse Euro fearmongering and demand more facts! These facts illustrate that Austria's economy is doing very well and that Austria has the lowest unemployment rate in Europe. Another fact is that membership in the EU and the Euro have had a clearly positive impact on Austria. The Euro is more than a mere business factor for Austria, as our businesses generate income mainly from exports to EU member states. 70% of our exports go to other EU countries. A single currency and stable prices are prime prerequisites for positive development in this field. Remember the ups and downs of the Italian Lira: some Austrian business people who were exporting their goods and services to Italy at that time even had to contemplate closing their companies as the Italian market was so unpredictable. The Euro brought about economic stability and helped to create new jobs. About 13,000 additional jobs have been created every year since our accession to the EU.” 

"These are the facts we should talk about instead of giving in to confusion about the Euro! There is no Euro crisis – this simply is the non-word of the past few years! Some Euro countries are faced with a national debt crisis, but this has no impact on the stability and value of our currency. Since its introduction, the Euro has always improved in value. While US Americans had to pay 1.17 Dollar for one Euro when it was introduced, they are now paying more than 1.3 Dollar for one Euro", the State Secretary concluded.

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