Covid-19: Euro zone inflation touches record 5% amid Omicron spread

Consumer prices in the 19 countries that use the euro currency soared at a record rate, led by a surge in food and energy costs, figures showed Friday.

Inflation rose to 5 per cent in December compared with a year earlier, according to Eurostat, the European Union's statistical office. That is the highest level in the eurozone since recordkeeping began in 1997, breaking the record of 4.9 per cent only just set in November.

Euro zone economic sentiment dropped more than expected last month while inflation hit another record high, indicating the economy is under renewed stress as surging coronavirus infections force governments to tighten restrictions.

With infections breaking records almost daily as the Omicron variant sweeps across Europe, growth is likely to take a hit around the turn of the year even though governments have largely avoided the debilitating measures that brought their economies to a standstill a year ago.

Poland hits 21-year high

Polish inflation hit a 21-year-high, exceeding most analysts’ forecasts and boosting expectations that the central bank will keep raising interest rates.

Consumer prices in December jumped 8.6 per cent from a year earlier, compared with 7.8 per cent in November, preliminary data showed on Friday. The reading was above a median of 8.2 per cent in a Bloomberg survey of 23 economists.

Virus spread = food outages at US stores

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The highly contagious omicron virus variant is disrupting already stressed food supply chains, sickening so many workers that more shortages at grocery stores are all but certain.

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Supermarkets have been struggling to keep food fully stocked throughout the pandemic as a result of labour shortfalls in every part of the food system, from farms to manufacturers to distributors. Schools and daycares are seeing closures again, keeping more Americans from work. All of that will help fuel wage increases and price surges for consumers, as well as 2020-style food outages. (Bloomberg)

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Germany to toughen restaurant rules

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Germany's leaders agreed Friday to toughen requirements for entry to restaurants and bars, and decided to shorten quarantine and self-isolation periods as the omicron variant spreads fast through the country.

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Chancellor Olaf Scholz and the 16 state governors built on restrictions introduced just after Christmas that limited private gatherings to 10 people and effectively shut nightclubs.

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People have already been required for some time to show proof of full vaccination or recovery to enter restaurants and bars — as well as many nonessential shops, theaters and cinemas. (AP)