- ORIGINAL NEWS
Inflation remains sticky in Europe, with core prices cooling less than expected
- SUMMARY
Inflation in the European Union decreased slightly in February to 2.6%, but it remained higher than anticipated.
Core inflation, which excludes volatile items like food and energy, also surpassed expectations at 3.1%.
While the headline inflation rate is approaching the European Central Bank’s goal of 2%, core inflation is still above 3%.
This presents a challenge for the ECB, as it must balance its inflation goals with concerns about economic stagnation.
Wage negotiations in the spring will further inform the ECB’s decision on whether to raise or lower interest rates.
Despite the slight decline in inflation, price increases remain significantly higher than before Russia’s invasion of Ukraine.
- NEWS SENTIMENT CHECK
- Overall sentiment:
neutral
Positive
“Inflation in the 20-nation euro zone eased to 2.6% in February, flash figures showed on Friday.”
“Energy prices, which had swollen last year as a result of Russia’s invasion of Ukraine, continued to reduce, with the rate of deflation moving from -6.1% to -3.7%”
Negative
“but both the headline and core figures were higher than expected.”
“Core inflation, stripping out volatile components of energy, food, alcohol and tobacco, was 3.1% — above the 2.9% expected.”