More expensive services lead euro zone inflation rebound in January
More expensive services and industrial goods led a rebound in inflation in January after months of falling prices, offsetting the downward pull of cheaper energy, data showed on Tuesday.
Volatile energy prices were 3.8% higher on the month but still 4.2% lower than a year earlier and unprocessed food was 1.2% more expensive on the month and 2.0% year-on-year.Without these two volatile components, consumer prices fell 0.3% against December and were 1.4% higher than in January 2020.
An even narrower measure excluding also alcohol and tobacco prices, that often change because of excise tax changes, fell 0.5% month-on-month in January and rose 1.4% in annual terms.Eurostat said services, which make up two thirds of the euro zone economy, added 0.65 percentage points to the final annual inflation result and non-energy industrial goods added another 0.37 point, offsetting a 0.41 point subtraction from cheap energy.
Food, alcohol and tobacco added 0.3 point, Eurostat said.The January rebound brings inflation, which has been negative for months, a bit closer to the European Central Bank’s target of below, but close to 2% over the medium term. Read more: Reuters Top News »
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