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Euro­zone infla­tion fell less than the fore­cast.

 

Europe
Euro­zone infla­tion fell less than fore­cast in Feb­ru­ary, mak­ing it the latest region to prompt expect­a­tions of fur­ther interest rate rises because of per­sist­ently high prices.

Con­sumer price growth dipped only slightly to 8.5 per cent in the year to Feb­ru­ary, from 8.6 per cent in Janu­ary, the EU stat­ist­ics agency said yes­ter­day, com­pared with a fore­cast of 8.2 per cent. Over the past month, fin­an­cial mar­kets have priced in higher interest rates for longer after the Fed­eral Reserve’s pre­ferred meas­ure of US infla­tion picked up in Janu­ary, and wage data came in strong in the US, the UK and parts of the euro­zone.

Ana­lysts said the new euro­zone data indic­ated infla­tion was likely to fall more slowly for the rest of the year than pre­vi­ously expec­ted and that the European Cent­ral Bank would keep rais­ing rates even after an expec­ted 0.5 per­cent­age point rise on March 16.

Core infla­tion, which cent­ral bankers watched closely as it excludes energy and food prices to give a clearer pic­ture of under­ly­ing pres­sures, rose to 5.6 per cent — up from 5.3 per cent in the pre­vi­ous month.

Christine Lagarde, ECB pres­id­ent, said before the fig­ures were released that while infla­tion was likely to have risen «a little bit» in Feb­ru­ary, it was on track to fall «much more» in March owing to the base effects of year-on-year com­par­is­ons with last year’s high energy prices.

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  1. Al3 March 2023 at 14:47


    I estimated an 8.4% and I was wrong. Inflation will keep going down but very slowly as months pass by. It will take many more months before prices start returning to a certain normal.

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