Eurozone Inflation March 2017

Eurozone

Eurozone: Inflation falls in March

April 19, 2017

Complete data released by Eurostat on 19 April confirmed that harmonized inflation was 1.5% in March, down from February’s 2.0%, which was the highest reading since January 2013. The result was in line with the preliminary estimate and below the European Central Bank’s target of close to, but below 2.0%. According to Eurostat, prices for food, alcohol, and tobacco grew at a slower pace than in April. The rise in energy prices also moderated, however, growth was still sharp overall. Annual average inflation rose from 0.5% in February to 0.7% in March, the highest result since July 2014.

Core inflation came in at 0.8% in March, a notch down from February’s 0.9%. Meanwhile, harmonized consumer prices rose 0.8% on a monthly basis, above February’s 0.4% increase.

Looking at the countries in the common-currency bloc, 11 of the 19 Eurozone economies showed inflation rates equal to or above the regional average. Latvia (3.3%), Lithuania (3.2%) and Estonia (3.0%) were the economies with the highest rates. On the other side of the spectrum, the Netherlands (0.6%) and Ireland (0.6%) had the lowest prices pressures. Among the largest economies in the Eurozone, Spain saw the highest inflation (2.1%), followed by Germany (1.5%). Meanwhile, inflation was below the region’s average in Italy (1.4%) and France (1.4%).

FocusEconomics Consensus Forecast participants see inflation in the Euro area averaging 1.5% in 2017, which is up 0.1 percentage points from last month’s forecast. For 2018, panelists also expect inflation to average 1.5%.


Author: Angela Bouzanis, Senior Economist

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Eurozone Inflation Chart


Euro Inflation by country March 2017

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


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