Eurozone Headline Inflation Falls, But 'Core' Disappoints

Summary

• The flash estimate shows a decline in eurozone HICP inflation from 2.9% to 2.8% in January, with core inflation declining to 3.3% from 3.4% in December. However, it's too soon to declare victory in the inflation battle.
• As industry and retail are still struggling with excess inventories, non-energy industrial goods price inflation continues to fall and now stands at 2%.
• Energy remains a disinflationary force, though the effect is petering out and will probably disappear completely in the second quarter, as the base effect will become less advantageous.

littleclie

By Peter Vanden Houte

Inflation falls slightly in January, core inflation disappoints

HICP inflation in the eurozone fell to 2.8% in January from 2.9% in December, in line with expectations; that's according to flash estimates. Energy prices remain an important factor in the downward