What has been the true trajectory of inflation in the United States and the euro zone over the last three years?

The true trajectory of inflation is adjusted for changes in import prices. It results solely from increases in unit labour costs and changes in profit margins. We can see that on this true inflation trajectory , true inflation : Rose from 1.5% to 7.5% from the start of 2021 to the start of 2022 in the United States; Rose from 0% to 7.3% between the second quarter of 2021 and the second quarter of 2022 in the euro zone; Fell from 7.5% to 3.3% between the start of 2022 and the end of 2023 in the United States; Fell from 7.3% to 3.8% between the second quarter of 2022 and the fourth quarter of 2023 in the euro zone. All in all, we see that in the United States, true inflation is very close (3.3% versus 3.2% in February 2024) to actual headline inflation, because import prices have stabilised, and that, in the euro zone, true inflation is much higher than actual headline inflation (3.8% versus 2.4% in March 2024) since import prices in the euro zone have fallen sharply.