Eurozone inflation slows to 8.5% in February
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Annual inflation in the euro area in February slowed to 8.5% after 8.6% in January and 9.2% in December 2022, follows from the preliminary estimates Eurostat.
Food, alcohol and tobacco rose in annual terms by 15% after 14.1% in January, non-energy manufactured goods – by 6.8% after 6.7%, and services – by 4.8% after 4.4%. At the same time, the growth in energy prices slowed down to 13.7% after 18.9% a month earlier.
Core inflation (rising prices excluding energy and food) rose from 5.3% in January to 5.6% in February.
The lowest inflation rates were recorded in Luxembourg (4.8%), Belgium (5.5%) and Spain (6.1%). Prices rose the most in Latvia (20.1%), Estonia (17.8%) and Lithuania (17.2%).
On February 2, the Board of Governors of the European Central Bank (ECB) decided raise all three key interest rates by 50 bp. The interest rate was increased to 3%, the deposit rate to 2.5% and the ECB margin loans to 3.25%.
As Vedomosti wrote earlier, the ECB’s Board of Governors called it the most desirable for Europe to reach the maximum rate by September of this year. This will allow the pan-European regulator to reach the inflation target of 2% by 2024-2025, said François Villeroy de Galo, member of the board and chairman of the Bank of France.
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