Photo: Xinhua/Zhang Fan
BRUSSELS, Jan. 5 (Xinhua) -- The annual inflation rate in the eurozone rebounded in December to 2.9 percent from 2.4 percent in November after a steady decline in recent months, according to a flash estimate released by Eurostat on Friday. The highest annual inflation rates for December were recorded in Slovakia (6.6 %), Croatia (5.4 %) and Austria (5.7 %). Annual inflation in the euro area continues to be driven by food, alcohol and tobacco prices, which reached 6.1 percent in December, compared with 6.9 percent in the previous month.
Meanwhile, year-on-year inflation in the cost of services remained stable at 4 percent from November to December. Non-energy industrial goods recorded an annual inflation rate of 2.5 % in December, down from 2.9 % in November.
People visit a Christmas fair at a shopping mall in Berlin, Dec. 21, 2023. (Xinhua/Ren Pengfei)
December's recovery in the annual inflation rate in the euro area was driven by energy prices, which rose from -11.5 % in November to -6.7 % in December. The highest annual inflation rates for December were recorded in Slovakia (6.6 %), Croatia (5.4 %) and Austria (5.7 %).
According to Bert Colijn, chief economist for the eurozone at Dutch financial corporation ING, the rise in inflation is mainly due to the fading effects of the energy base and concerns about supply from the Red Sea. According to Colijn, inflation will collapse in 2023 due to weak demand and fading supply shocks. "The outlook for inflation remains relatively benign and we expect eurozone inflation to return to around two per cent by the end of the year," he added.
In December 2023, the European Central Bank decided to leave its key interest rates unchanged. Despite the recent decline in inflation in the euro area, the bank warned that "inflation, while having fallen in recent months, is likely to rise again temporarily in the near future".
Xinhua/RoZ_07
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