Eurozone consumer price inflation slowed as expected in December, the European Union’s statistics office Eurostat confirmed on Wednesday. The deceleration is attributed to a continued fall in energy prices that had earlier lifted prices to record highs.
Final inflation was confirmed at 9.2 per cent year-over-year, down from 10.1 per cent in November. Energy prices in the currency bloc were up 25.5 per cent in December compared to the same month the prior year. This was down from the 34.9 per cent year-on-year growth the month before.
Core inflation, that excluded food and energy prices, rose by 0.2 percentage points to 5.2 per cent, in line with the consensus expectations and the initial estimate.
However, European Central Bank president Christine Lagarde, said: “We shall stay the course until such time when we have moved into restrictive territory for long enough so that we can return inflation to two per cent in a timely manner”.
In the meantime, the Federal Reserve’s (Fed) Beige Book, a compilation of anecdotal evidence on economic conditions in each of the 12 Fed districts, showed economic activity little changed and growth outlooks still anemic.
Five districts showed slight or modest increases in overall activity, six noted no change or slight declines and one cited a significant decline. Some retailers reported strong sales over the holidays while others noted that high inflation continued to reduce consumers’ purchasing power.
Regarding inflation, while prices rose at a “modest to moderate pace” in most districts, many noted that the rate of increases had slowed thanks to continued easing in supply chain issues, according to the report, which was based on information collected on or before January 9. Looking forward, contacts overall expect year-ahead price growth to moderate further.
Finally, in the UK, house prices rose by 10.3 per cent in November compared with the same month in 2021, the Office for National Statistics (ONS) said on Wednesday. That is down from October’s revised 12.4 per cent rise.
The typical UK house price was £295,000, which was £28,000 higher than a year earlier but a slight decrease from the previous month’s record high of £296,000. Average prices in London remained the most expensive of any region in the UK, with an average price of £542,000 in November. However, the capital was the English region with the lowest annual house price inflation of 6.3 per cent.
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