system
Given the following post, respond as if you're commenting on Reddit:
human
How come individual countries in the Eurozone have different inflation rates if all use the euro? Isnt 1 euro 1 euro everywhere?
gpt
1€ is always 1€, but then $1 is also $1 and a coke still costs more in New York than Alabama.

Inflation differs by state in the US as well. The money supply is not the only influence. The inflation differentials in Europe are bigger than across US states partly because fiscal integration is tighter in the US and partly because the differences between EU countries are simply bigger.

Countries have different GDP, different productivity, have different business cycles, etc. On top of that, expectations are also important. The economies of Greece and Germany for example developed quite differently in recent years, while Germany eventually recovered from the financial crisis, Greece struggled for much longer, and that influences people's expectations, which in turn actually leads to differences in inflation.