Core inflation hits record in Eurozone

The European Statistical Office (Eurostat) has released the latest inflation data for the Eurozone for the period of January.

Accordingly, core inflation exceeded the initial reading of 5.2 percent and reached 5.3 percent. On the other hand, the 0.2 percent monthly decrease was in line with the expectations.

Headline inflation, which includes food and energy, rose by 0.1 percentage points to 8.6 percent after the latest data from Germany were released higher than the preliminary estimate. Data released by Eurostat showed that after the Ukraine war increased energy costs, the price shock in Europe became permanent.

Revised data showing that inflation in the euro area hit a record high in January reinforces the European Central Bank’s (ECB) plan to raise interest rates by another half point next month.

Officials led by ECB President Christine Lagarde said at their last meeting that they planned to increase the deposit rate from 2.5 percent to 3 percent.