Inflation drops in February as coronavirus hits energy prices
Complete data revealed harmonized inflation dropped to 1.2% in February from January’s 1.4%, which had marked the highest reading since February 2019, matching the preliminary estimate. Inflation thus moved further below the European Central Bank’s target rate of near, but under, 2.0%. February’s decrease was entirely due to a downturn in energy prices prompted by coronavirus fears. On the other hand, prices for food, alcohol and tobacco as well as for services and non-industrial goods rose at a faster clip than in January.
On a monthly basis, harmonized prices increased 0.2% in February, contrasting January’s 1.0% drop. Core inflation, which excludes volatile energy and unprocessed foods prices, was stable at January’s 1.3% in the second month of 2020.