Abstract
The aim of this study is to analyse the price developments and to compare national macroeconomic policies in response to the consumer prices that started to soar in 2007 across the European Neighbourhood Policy countries, the other arcelona countries2, Russia, the Gulf Cooperation Council countries and the euro area. The analyses focus primarily on ag-flation, but we analyse also the capital inflows in view of income levels in the EU's neighbour countries. The analyses unambiguously show that food inflation was pushing up total inflation, even despite the provision of food subsidies by national authorities.
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