AGL 40.00 No Change ▼ 0.00 (0%)
AIRLINK 129.00 Decreased By ▼ -0.53 (-0.41%)
BOP 6.76 Increased By ▲ 0.08 (1.2%)
CNERGY 4.50 Decreased By ▼ -0.13 (-2.81%)
DCL 8.70 Decreased By ▼ -0.24 (-2.68%)
DFML 41.00 Decreased By ▼ -0.69 (-1.66%)
DGKC 81.30 Decreased By ▼ -2.47 (-2.95%)
FCCL 32.68 Decreased By ▼ -0.09 (-0.27%)
FFBL 74.25 Decreased By ▼ -1.22 (-1.62%)
FFL 11.75 Increased By ▲ 0.28 (2.44%)
HUBC 110.03 Decreased By ▼ -0.52 (-0.47%)
HUMNL 13.80 Decreased By ▼ -0.76 (-5.22%)
KEL 5.29 Decreased By ▼ -0.10 (-1.86%)
KOSM 7.63 Decreased By ▼ -0.77 (-9.17%)
MLCF 38.35 Decreased By ▼ -1.44 (-3.62%)
NBP 63.70 Increased By ▲ 3.41 (5.66%)
OGDC 194.88 Decreased By ▼ -4.78 (-2.39%)
PAEL 25.75 Decreased By ▼ -0.90 (-3.38%)
PIBTL 7.37 Decreased By ▼ -0.29 (-3.79%)
PPL 155.74 Decreased By ▼ -2.18 (-1.38%)
PRL 25.70 Decreased By ▼ -1.03 (-3.85%)
PTC 17.56 Decreased By ▼ -0.90 (-4.88%)
SEARL 78.71 Decreased By ▼ -3.73 (-4.52%)
TELE 7.88 Decreased By ▼ -0.43 (-5.17%)
TOMCL 33.61 Decreased By ▼ -0.90 (-2.61%)
TPLP 8.41 Decreased By ▼ -0.65 (-7.17%)
TREET 16.26 Decreased By ▼ -1.21 (-6.93%)
TRG 58.60 Decreased By ▼ -2.72 (-4.44%)
UNITY 27.51 Increased By ▲ 0.08 (0.29%)
WTL 1.41 Increased By ▲ 0.03 (2.17%)
BR100 10,450 Increased By 43.4 (0.42%)
BR30 31,209 Decreased By -504.2 (-1.59%)
KSE100 97,798 Increased By 469.8 (0.48%)
KSE30 30,481 Increased By 288.3 (0.95%)

BRUSSELS: The annual rate of inflation in the eurozone rose to 2.9 percent in December mainly due to energy costs, official data showed Friday.

Consumer prices edged up from the 2.4 percent annual rate in November 2023, in line with expectations by analysts for Bloomberg.

It is the first rise in the annual rate of inflation since an unexpected increase in April last year.

The data supports comments by European Central Bank (ECB) chief Christine Lagarde, who has warned that Europe should remain on guard despite falling inflation.

The ECB has undertaken a series of interest rate hikes to tame red-hot inflation after consumer prices reached a peak of 10.6 percent in October 2022.

But as eurozone inflation edged closer to the ECB’s two-percent target, there have been growing calls to cut rates, which the bank’s officials have pushed hard against.

Eurozone business activity downturn deepens in Dec

“December’s jump in headline inflation in the eurozone was widely anticipated and entirely due to a base-effects driven increase in energy inflation, so it won’t alter ECB policymakers’ views on the outlook for monetary policy,” said Jack Allen-Reynolds, deputy chief eurozone economist at Capital Economics.

The rise had been expected because of governments had provided exceptional support in December 2022 to households to confront heating bills that had surged due to Russia’s invasion of Ukraine.

No victory yet

Energy prices in the eurozone fell in December, by 6.7 percent on an annual measure, but that was less than the 11.5 percent drop in November, data published by the EU’s official statistics agency showed.

Food and drink price increases slowed down to 6.1 percent last month compared with 6.9 percent in November, according to Eurostat.

Core inflation, which strips out volatile energy, food, alcohol and tobacco prices, however slowed to 3.4 percent in December from 3.6 percent in November, Eurostat said.

Core inflation is the key signal for the ECB.

The ECB’s Lagarde has insisted that it is too early to declare victory over inflation and has previously dismissed any talk about interest rate cuts as “premature”.

The next rate decision meeting will be on January 25.

Allen-Reynolds of Capital Economics said he still suspected the ECB would start cutting rates “in or around April”.

Among the 20 countries that use the euro, Belgium and Italy had the lowest inflation rate, reaching 0.5 percent in December, Eurostat said.

Inflation also rose in the European Union’s two biggest economies. In Germany, inflation increased to 3.8 percent in December from 2.3 percent the previous month. And in France, consumer prices ticked up to 4.1 percent in December from 3.9 percent in November, Eurostat said.

Comments

Comments are closed.