Euro area annual inflation rise in December, below market forecast

By Tuba Ongun

The euro area annual consumer inflation rate rose at a slower pace than expected to 2.9% in December 2023, according to flash estimates released on Friday.

Reversing from a seven-straight month of slowdown, the figure accelerated from 2.4% in November, the Eurostat data showed.

Market expected headline inflation to come in at 3% for the month.

Energy prices dropped 6.7% year-on-year in December 2023, following an 11.5% decline in November.

The annual price hike for food, alcohol, and tobacco continued to ease in December, to 6.1%.

On a monthly basis, the euro area consumer price index increased 0.2% in December, shifting from a 0.6% decline in November.

In December 2023, energy prices in the single currency area dropped 1.5% month-on-month, while food prices posted no change.