Pandemic and invasion related inflation in the selected European Union countries

Abstract

The invasion of Russia in Ukraine brought not only the suffering of the Ukrainian people, but also an unprecedented rise in price levels in Europe. Moreover, the European Union countries underwent a series of negative supply shocks caused by pandemic-induced supply chain disruptions and the invasion-induced energy crisis. Through the available data on inflation, the harmonized index of consumer prices and other variables related to it, we analyse the growth of the price level in the EU countries. In this contribution we focus on the first year of the invasion. The methodological tool is cluster analysis in SPSS, as we use the dendrograms and graphs to find out in which countries the supply chain disruptions, the war in Ukraine and consequent energy crisis have a significant impact in increasing price levels in the EU in 2022. These are countries more energy dependent on Russian suppliers of oil or natural gas.