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Euro zone inflationary pressures still subdued


Inflationary pressures rose a tad in the euro zone around the start of the year but remain low, an indicator designed to predict cyclical trends showed on Friday.

The Eurozone Future Inflation Gauge ( EZFIG), published by the Economic Cycle Research Institute, rose to 92.3 in January from December's 91.7.

Published a day after the European Central Bank left rates on hold despite inflation being well below its target of close to 2 per cent, the data will do little to allay fears about deflation in the 18-nation bloc.

Euro zone inflation stabilised in the ECB's "danger zone" last month rather than falling as expected.

"Euro zone inflation pressures, while having edged up, remain subdued," said Lakshman Achuthan, ECRI's chief operations officer.

Inflation pressures in Spain jumped but they eased in Germany and Italy.

European Union statistics office Eurostat estimated last week consumer prices rose an annual 0.8 per cent in February, the same rate as in January and December.

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