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Some people are suddenly panicking over the announcement that the euro area is officially in deflation. But sudden panic is the wrong reaction; you should have been gradually panicking over an extended period. Today’s news isn’t actually any worse than what we’ve been seeing for a while.

The key is not to look at the headline number; you should keep your eyes on the core.

Core inflation — like the Keynesian multiplier — is one of those much-ridiculed concepts (hey, you’re measuring inflation without the inflation!) that has in fact performed extremely well in recent years. Back in 2010-11, when rising gas prices were sending headline numbers up, I and many others received a lot of hostile comments for claiming that there wasn’t any real inflation bulge; but core inflation has indeed been a much more reliable guide than headline inflation, which fluctuates wildly. As the accompanying chart shows, this has been as true for Europe as it is for America.

And core inflation is basically unchanged in the latest report. It has been on a long slide, and is far below the ECB’s target (which is itself too low). But no more bad news today, anyway. The same logic that made me ignore the inflation bulge when oil was going up says to ignore the dip from plunging oil. I won’t say not to panic — you should be panicking about Europe. But keep it steady, OK?