Inflation Eases in the Euro Area
ebruary 2024 saw the Euro area’s annual inflation rate drop to 2.6%, a notable decline from January’s 2.8% and a significant decrease from the 8.5% rate a year earlier. This downward trend mirrors the European Union’s inflation rate, which fell to 2.8% from January’s 3.1% and the previous year’s 9.9%. Latvia, Denmark, and Italy recorded the lowest annual rates, contrasting sharply with the higher rates in Romania, Croatia, and Estonia. Most Member States reported a fall in annual inflation, indicating a broad-based easing of price pressures.
Key Contributions to Inflation
The major contributors to the annual inflation rate in the Euro area were services, adding 1.73 percentage points to the overall rate. This was followed by food, alcohol & tobacco, and non-energy industrial goods. Interestingly, energy contributed negatively, hinting at possible relief in energy costs, a significant factor in recent inflation spikes.
