US economy

Euro zone inflation eases as expected, but core figures disappoint

Patrons at sidewalk tables of Janis bar in Cais do Sodre in Lisbon, Portugal.

Horacio Villalobos | Corbis News | Getty Images

Euro zone headline inflation eased slightly in January, flash figures published by the European Union’s statistics agency showed on Thursday, while core figures declined less than expected.

Annual headline price rises came in at 2.8%, in line with a forecast of economists polled by Reuters. Inflation stood at 2.9% in December, up from 2.4% in November, largely due to the wind-down of energy price support measures.

Core inflation dipped to 3.3% in January from 3.4% in December. A Reuters forecast indicated a fall to 3.2% for last month.

Economic growth has been stagnating in the bloc.

Preliminary figures out earlier this week showed inflation in Germany easing slightly more than had been forecast, reaching 3.1%. The euro zone’s biggest economy has become one of its main drags on growth, with the German GDP contracting by 0.3% in the fourth quarter.

European Central Bank officials are monitoring a host of data to see if and when they can begin bringing interest rates down from their current record highs.

While markets continue to price in cuts starting in April, some policymakers have pushed back with suggestions that declines are likelier to take place in the summer or even later. The ECB stresses it remains data-dependent.

This is a developing news story. Please check back for updates.