Italy: Consumer prices fall to multi-year low in January
February 23, 2015
Consumer prices fell 0.4% over the previous month in January, which was notably down from the flat growth recorded in December. January’s decline surprised the markets as they had expected another flat reading in January. According to the National Statistics Institute (Instat), January’s figure reflected lower prices for fuels, electricity, and services related to transport, all of which were derived from lower global oil prices. Conversely, prices for fresh vegetables increased compared to the previous month due to seasonal factors. In annual terms, consumer prices tumbled from a flat reading in December to a 0.6% drop in January, which marked a multi-year low.
Core consumer prices, which exclude more volatile categories such as unprocessed food and energy, declined 0.2% in January over the previous month, which contrasted the 0.2% rise tallied in December. Annual core inflation declined from a 0.6% rise in December to a 0.3% increase in January. Finally, annual harmonized consumer prices declined 0.4% in January, which was down from the 0.1% drop in December and represented a multi-year-low.
Author: Cecilia Simkievich, Economist