Two parents and their two children cross a section of sweet cakes, cookies and jam.
Nicolas Guyonnet | AFP | Getty Images
The inflation of the euro zone took place at 2.4% in February, but was slightly higher than the expectations of analysts, according to flash data from the Eurostat Statistics Agency on Monday.
Economists interviewed by Reuters expected inflation to 2.3% in February, down compared to the 2.5% of January reading.
The so -called basic inflation, which eliminates the costs of energy, food, alcohol and tobacco, reached 2.6% in February, just below the printing of 2.7% of the previous month.
Reading the inflation of closely watched services, which turned out to be sticky in recent months, also held, 3.7% last month, compared to January 3.9%.
Monday figures also highlighted a net slowdown in energy price increases, which only increased by 0.2% in February, against 1.9% in the first month of the year.
“The drop in the inflation of February titles was encouraging because it was partly due to lower services,” Jack Allen-Reynolds, deputy chief economist in the euro area in Capital Economics on Monday, on Monday.
“We believe that the decline in February’s inflation of services is the start of a trend that will considerably reduce the basic rate this year,” he added.
The inflation of the headlines should remain around its current levels, noted Allen-Reynolds, because the energy prices should increase slightly and that food inflation should remain above the 2%mark.
However, according to the way in which the current geopolitical situation is developing, this could possibly have an impact on inflation, noted on Monday Bert Colijn, chief economist of the Netherlands.
“Geopolitical developments make the inflation prospects very uncertain for the moment. Think, for example, of uncertainty surrounding a trade war and energy prices,” he said.
The repeated threats of US President Donald Trump to impose prices on goods imported from Europe have left investors and uncertain economists about the prospects of inflation and economic growth. Prices are often considered to be inflationary, and trade with the United States is a key pillar for several major European countries, in particular the largest EU economy, Germany.
The inflation of the euro zone has reinstated in the fourth quarter, but decision -makers of the European Central Bank remain optimistic about its trajectory. Accounts Since the January bank’s January bank meeting last week, decision -makers thought that inflation was about to reach the 2%goal, despite certain persistent concerns.
The ECB is reversed again later this week and should largely announce another drop in interest, which will mark its sixth reduction since it has started to soften monetary policy in June.
The markets will also pay particular attention to the BCE declaration accompanying the rate decision, looking for indices on the assessment of inflation political decision -makers and monetary policy restrictions.
“For the European Central Bank, the big question is how low it will go,” said colijn of ING, adding that Monday data will support the idea that inflation is currently “quite benign”, but that it will not provide a solid base on the way in which low rates should be.
“We expect another drop of 0.25 ppt later this week to be accompanied by a fierce debate at the moment when the ECB will reach its terminal rate,” he said.
Monday data intervenes after several major savings within the euro zone reported inflation data last week. Provisional data has shown that February inflation was unchanged at a level greater than 2.8% in Germany, but strongly destroyed at 0.9% France. Readings are harmonized in the euro zone to ensure comparability.
