Eurozone Inflation Slows; Jobless Rate Lowest Since 2008
March 03 2020 - 2:20AM
RTTF2
Eurozone inflation slowed on falling energy prices in February
and the unemployment rate held steady at the lowest level in more
than a decade at the start of the year, official data showed
Tuesday.
According to the flash estimate from Eurostat, inflation in the
currency bloc slowed to 1.2 percent in February from 1.4 percent in
January. The rate came in line with expectations.
Headline inflation remained well below the European Central
Bank's target of "below, but close to 2 percent."
However, core inflation that excludes energy, food, alcohol and
tobacco, edged up to 1.2 percent from 1.1 percent a month ago.
The impact of Covid-19 on the economy will distort inflation
figures in the months ahead, but it is too early to tell just yet,
Bert Colijn, an ING economist, said.
For the ECB, today's figures will be no more than confirmation
of the current modest inflation environment, the economist said.
For the March 12 meeting, immediate Covid-19 measures will be much
more relevant than the February inflation environment.
Data showed that energy prices dropped 0.3 percent, reversing a
1.9 percent rise in January.
Meanwhile, annual growth in food, alcohol and tobacco prices
rose to 2.2 percent from 2.1 percent. Likewise, prices of
non-energy industrial goods and services grew at faster rates of
0.5 percent and 1.6 percent, respectively.
On a monthly basis, the harmonized index of consumer prices
gained 0.2 percent in February. Final data is due on March 18.
Another report from Eurostat revealed that producer prices
dropped at a slower pace of 0.5 percent year-on-year in January,
following a 0.6 percent decline in December.
However, excluding energy, producer prices rose at a slightly
faster pace of 0.6 percent annually in January.
The jobless rate remained unchanged at 7.4 percent, as expected,
in January. This was the lowest since May 2008. In the same period
last year, the unemployment rate was 7.8 percent.
The number of people out of work increased by 1,000 from
December and declined 593,000 from last year. Unemployment totaled
12.179 million.
The unemployment rate among youth, aged below 25, was stable at
15.6 percent in January.
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