Europe's sensitivity to oil shocks is about twice that of the United States

Golden Ten Data reported on April 11 that a research report from Bank of America pointed out that the euro zone is far more sensitive to oil prices than the United States. The research found that a 10% oil price shock results in an inflation impact of approximately 40 basis points, with a corresponding growth impact exceeding 10 basis points. Both effects are about twice as high as those in the United States. In our view, the higher share of energy in Europe’s consumption basket and its status as a net oil importer are the main reasons for this result.