Eurozone Inflation

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Eurozone: Annual inflation slows down in November amid second consecutive monthly drop in consumer prices

December 17, 2014

According to data released by Eurostat on 17 December, the harmonized index of consumer prices (HICP) fell 0.2% in November over the previous month. The result marked the second consecutive monthly drop in prices; a 0.1% drop was recorded in October.

Annual headline inflation inched down from 0.4% in October to 0.3% in November. The reading was in line with the flash estimate released on 28 November. This is the 14th consecutive month in which annual inflation is in what ECB President Mario Draghi called the “danger zone” of below 1.0%. Annual average inflation inched down from October’s 0.6% to 0.5% in November.

The core inflation index, which does not include prices for energy and unprocessed food, dropped 0.1% in November over the previous month (October: 0.0% month-on-month). Annual core inflation remained at October’s 0.7% in November.

At a country level, 8 of the 18 Eurozone economies posted annual inflation rates equal to or above the regional average. Austria (1.5%) and Finland (1.1%) recorded the highest annual inflation rates. At the other end of the spectrum, Greece (-1.2%) and Spain (-0.5%) experienced year-on-year decreases in harmonized consumer prices. Among the remaining major economies in the Eurozone, inflation was above the regional average in Germany (0.5%) and in France (0.4%), while it was in line with the average in Italy (0.3%).

FocusEconomics Consensus Forecast participants see inflation in the Euro area averaging 0.8% in 2015, which is down 0.2 percentage points from last month’s forecast. For 2016, panelists expect inflation to average 1.3%.


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Euro Inflation by country November 2014

Note: Year-on-year var. of harmonized consumer price index (HICP) in %.
Source: Eurostat


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