Synopsis
The Eurozone's inflation rate reached 2.5% in January, up from 2.4% in December 2024, according to Eurostat. Services showed the highest inflation at 3.9%, while energy prices surged significantly. The ECB has adjusted interest rates following these developments.Key Takeaways
- Inflation rose to 2.5% in January.
- Services experienced the highest annual inflation rate of 3.9%.
- Energy prices increased significantly to 1.8%.
- Croatia recorded the highest inflation rates at 5%.
- ECB cut interest rates by 25-basis-points.
Brussels, Feb 3 (NationPress) The annual inflation rate for the Eurozone increased to 2.5% in January, rising from 2.4% in December 2024, as per a preliminary estimate published by Eurostat on Monday.
Services are projected to exhibit the highest annual inflation rate of 3.9%, a decrease from 4% in the previous month. Inflation for food, alcohol, and tobacco was recorded at 2.3%, lower than 2.6% in December.
Energy prices showed a notable increase in annual inflation, surging from 0.1% in December to 1.8% in January, while inflation for non-energy industrial goods remained unchanged at 0.5%.
Among Eurozone countries, Croatia experienced the highest inflation rates at 5%, followed by Belgium at 4.4% and Slovakia at 4.1%.
The principal EU economies reported the following inflation rates in January: Germany at 2.8%, France at 1.8%, Italy at 1.7%, and Spain at 2.9%.
"Inflation has increased from 2.4% to 2.5% in January, marking the fourth consecutive rise for the Eurozone," stated Bert Colijn, ING's chief economist for the Netherlands.
Though inflation is forecasted to ease throughout the year, Colijn warned of ongoing risks, such as escalating energy prices and the possibility of a tariff conflict between the United States and the European Union, as reported by Xinhua news agency.
Recently, the European Central Bank (ECB) declared a 25-basis-point interest rate cut in reaction to weak economic indicators in the Eurozone. The decision was made based on "an updated evaluation of the inflation outlook, the dynamics of underlying inflation, and the efficacy of monetary policy transmission," the ECB noted in a press release.
