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A person buys products at a Mercadona store in Lisbon, Portugal, on January 25, 2025.<\/p>\n
Luis Boza | Nurphoto | Getty Images<\/p>\n<\/div>\n<\/div>\n<\/div>\n
The euro zone inflation accelerated to a hotter-than-expected 2.5% in January on an annual basis, flash data from statistics agency Eurostat showed Monday.<\/p>\n
Economists polled by Reuters had expected the January inflation print to come in at 2.4%, unchanged from December<\/a>.<\/p>\n So-called core inflation, which strips out food, energy, alcohol and tobacco prices, came in at 2.7% in January and has remained unchanged since September. The closely watched services inflation print meanwhile inched lower to 3.9% in January from 4% in December.<\/p>\n Energy costs however jumped, rising 1.8% from a year earlier. This was up sharply from December’s 0.1% increase.<\/p>\n Headline inflation in the euro zone hit a low of 1.7% in September, but has since re-accelerated as base effects from lower energy prices have faded. The European Central Bank<\/a> last week said disinflation “is well on track.”<\/p>\n “Inflation has continued to develop broadly in line with the staff projections and is set to return to the Governing Council’s 2% medium-term target in the course of this year,” the bank added. “Most measures of underlying inflation suggest that inflation will settle at around the target on a sustained basis.”<\/p>\n The ECB on Thursday cut interest rates by 25 basis points, bringing the key deposit facility rate to 2.75%. Further rate reductions are expected from the ECB throughout the year.<\/p>\n The Monday data comes after several key euro zone economies, including France and Germany, last week reported their latest consumer price index data. The annual rate hit 1.8% in France<\/a> and 2.8% in Germany<\/a>, according to preliminary data from the country’s statistics agencies. The figures are harmonized across the euro zone for comparability.\u00a0<\/p>\n