Imported inflation and domestic inflation are not at all the same

When inflation is imported (due to a rise in the price of energy, metals, imported agricultural products), there is a levy on the country's real income and domestic demand falls. The question is whether the burden of rising prices for imported products is borne primarily by households (in which case consumption declines), by companies (in which case earnings decline), or by the government (in which case those who expect that they will be taxed at a later stage reduce their demand). This depends on the degree of indexation of wages to prices and the fiscal policy measures taken. When inflation is domestic, there is no loss of real income overall; there is only a possible transfer of real income between households and companies, which depends on relative increases in wages and prices. Today, in the United States, the additional inflation is mainly domestic; in the euro zone, it is mainly imported. This means that inflation will reduce growth in the euro zone, but much less so in the United States.