Eurozone: Inflation slows to almost three year low
March 1, 2013
According to a flash estimate released by Eurostat on 1 March, the harmonized index of consumer prices (HICP) added 1.8% in February over the same month last year. The reading was down from January's 2.0% rate and marks the lowest reading since August 2010. Month-on-month price variations, together with a more detailed set of data, will be provided on 15 March.
In January, consumer prices fell 1.0% over the previous month, which contrasted the 0.4% rise recorded in December. As a result of the monthly drop, annual headline inflation dropped to 2.0% from December's 2.2%. As a result, annual average inflation slowed to 2.4%, down from 2.5% in December.
The core inflation index, which does not include prices for energy, dropped 1.5% over the previous month (December: +0.5% month-on-month). Annual core inflation inched down from December's 1.6% to 1.5%.
At a country level, 11 out of the 17 Eurozone economies posted annual inflation rates equal or above the regional average. Estonia (3.7%) and Austria (2.8%) recorded the highest annual inflation rates. At the other end of the spectrum, inflation was lowest in Greece (0.0%) and Portugal (0.4%). Among the major economies, inflation was above the regional average in Italy (2.4%) and Spain (2.8%), whereas it was below in Germany (1.9%) and France (1.4%).
FocusEconomics Consensus Forecast participants see inflation in the Euro area averaging 1.8% in 2013, which is down 0.1 percentage points from last month's forecast. For 2014, panellists expect inflation to average 1.7%.
Author: Armando Ciccarelli, Head of Data Solutions