- Prior +0.8%
- HICP +0.4% vs +0.4% y/y prelim
- Prior +0.7%
No changes to the initial estimates as French inflation continues to keep on the lower side, helping to somewhat balance out the higher price pressures in the German and Spanish economies especially.
Core annual inflation is also continuing to moderate, dropping to 0.7% in January – down from 1.1% in December last year. That as services inflation falls further to 1.7%, down from 2.1% in the month before. However, food price inflation accelerated slightly to 1.9% – up from 1.7% in December. So, there is a bit of a mix there with the prices of manufactured products seeing a marked decline of 1.2%.
The overall chart:
All in all, this won’t offer much change to the ECB outlook for now. That unless we start to see a material shift in price pressures in Germany in the months ahead. Then, the softer French numbers here could be a push for a final set of rate cuts before the year is over and done with.
For now, it’s all conjecture though. We can only wait and see to scrutinise the developments to come.
