February 03, 2021
Eurostat, the statistical office of the European Union forecast euro area annual inflation rate to be 0.9% in January 2021, up from -0.3% in December 2020. This flash estimate was based on observation of the main components movements. As noted by Eurostat, “food, alcohol & tobacco is expected to have the highest annual rate in January (1.5%, compared with 1.3% in December), followed by services (1.4%, compared with 0.7% in December), non-energy industrial goods (1.4%, compared with -0.5% in December) and energy (-4.1%, compared with -6.9% in December).”
The inflation rate as at January 2020 amounted to be 1.4% and remain unchanged at -0.3% for four consecutive months after dropping to -0.2% in August 2020. It was observed that Food, alcohol & tobacco started the year at 2.1% and closed at 1.3% as at December 2020 and Energy annual inflation rate decreased from 1.9% in January to -6.9% in December. Non-energy industry goods inflation rate also declined from 1.5% in January to 0.7% in December 2020, while Service rate fell from 1.5% at the start of the year to 0.7% as at December 2020.
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