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Belgium Inflation December 2022

Belgium: Harmonized inflation falls to lowest level since May in December

Harmonized inflation eased to 10.2% in December, from Novembers 10.5%. December’s result marked the weakest inflation rate since May. The figure was primarily driven by lower price pressures for housing and utilities and transport.

Nevertheless, the trend pointed up; annual average harmonized inflation came in at 10.3% in December (November: 10.0%). In addition, core inflation reached 7.1% in December from 6.8% in November.

Meanwhile, consumer price inflation edged down to 10.4% in December, from Novembers 10.6%.

Finally, harmonized consumer prices fell 0.23% from the previous month in December, a more moderate drop than November’s 0.96% fall.

Inflation is forecast to soften this year on the back of a tougher base effect. That said, the automatic wage indexation mechanism will put upside pressure on core inflation; approximately 1 million workers are expected to receive an 11.6% pay rise in 2023.

Commenting on the outlook, analysts at EIU said:

“We expect inflation to remain elevated in 2023, but to continue easing gradually in the months ahead. […] High core inflation and still-elevated food prices (up by 15.4% in December) will prevent a more notable decline in inflation and recovery in consumer spending in 2023.”

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