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A salesman getting ready a bag of sweets for a buyer within the Sicilian confectionery store Mazzone on February 02, 2024 in Catania, Italy.
Fabrizio Villa | Getty Photographs Information | Getty Photographs
Inflation within the 20-nation euro zone eased to 2.6% in February, flash figures confirmed on Friday, however each the headline and core figures had been larger than anticipated.
Economists polled by Reuters had forecast a headline studying of two.5%.
Core inflation, stripping out risky parts of power, meals, alcohol and tobacco, was 3.1% — above the two.9% anticipated.
The European Union statistics company mentioned meals, alcohol and tobacco had the very best inflation fee in February at 4%, adopted by companies at 3.9%.
Power costs, which had swollen final yr on account of Russia’s invasion of Ukraine, continued to cut back, with the speed of deflation shifting from -6.1% to -3.7%.
The headline print beforehand got here in at 2.8% in January, with additional easing anticipated after worth rises cooled in Germany, France and Spain.
Traders are trying to find clues on when the European Central Financial institution will begin to carry down rates of interest, with market pricing pointing to a June cut. But many ECB officers nonetheless stress that they want spring wage negotiations to conclude earlier than they’ve a clearer image of home inflationary pressures.
The February figures might be a combined bag for policymakers, as core inflation is holding above 3% even because the headline fee strikes towards the ECB’s 2% goal. Worth rises have nonethless cooled considerably from their peak of 10.6% in October 2022.
The ECB should additionally take care of financial stagnation within the euro zone, after the bloc narrowly avoided a recession final yr, posting flat gross home product development within the fourth quarter.
European inventory beneficial properties moderated following the inflation print, buying and selling 0.2% larger down from 0.5% earlier within the morning. The euro was flat towards the U.S. greenback and the British pound.
