Inflation in the euro area down much stronger than economists’ forecasts

The December price growth index went down much more than the forecasts of analysts and economists, who expected 9.7 percent. Core inflation (showing price growth in the economy excluding food and energy prices) rose from 5 to 5.2 percent.

According to Eurostat data, the pace of price growth in the euro area varies, with the fastest rate in the Baltic states. In Lithuania and Latvia, inflation was over 20%, in Estonia it was over 17%. Double-digit levels were still in Slovakia, Italy, the Netherlands, Austria and Belgium. The least severe price increases were recorded in Spain, where inflation amounted to 5.6 percent.

According to the EU statistical office, the main components of the increase in inflation are primarily energy, which rose by 25.7 percent in December, followed by food, alcohol and cigarettes. Prices of services grew the slowest – by 4.4 percent.

Inflation in Poland. Few expected such a result

In Poland in December 2022, inflation amounted to 16.6 percent. year-on-year, the Central Statistical Office announced on Thursday in the so-called quick respect. This is less than in September (17.2%), October (17.9%) and November (17.5%) and – as in the case of the index for the euro area – much less than the forecasts of economists who expected reading about 17.3 percent.

Month to month (ie compared to November this year) inflation amounted to 0.2 percent. This is the lowest reading since February this year.

According to the data of the Central Statistical Office, in December, in year-on-year terms, the prices of energy carriers increased the most – by 31.2 percent. (but their prices fell by 3.3 percent compared to November this year). Fuel prices rose 13.5 percent. year-on-year (down 1.6 percent month-on-month), while food and non-alcoholic beverages increased by 21.5 percent over the year. (for a month by 1.4 percent).

On Friday, January 13, the Central Statistical Office will publish more detailed data for December – broken down into many more categories of products and services. At the same time, a symbolic revision of the inflation reading will be possible. This is something that happens often, even though the inflation data for November was revised last month from the original reading of 17.4 percent. to 17.5 percent.

The fact that inflation in December turned out to be lower than in previous months does not mean, unfortunately, that it is in a permanent downward trend. Economists expect inflation to increase further in January and February – although it is unlikely to exceed 20 percent. – as a result, among others almost complete dismantling of the anti-inflation shield. More in the article below: