First increase in five months
The cost of living in the eurozone rose again at the start of the year after five months of falling prices. Consumer prices increased by 0.9 percent in January, as the European statistics agency Eurostat announced in an initial estimate on Wednesday. Economists had only expected an inflation rate of 0.5 percent.
In December and in the three months before, inflation was minus 0.3 percent. One reason for the increase in the new year was, in particular, energy prices, which fell significantly less than in previous months. Industrial goods also rose in price for the first time in several months in January.
For the European Central Bank (ECB), the price increase comes in very handy. Because the central bank is aiming for just under two percent inflation as the optimum value for the economy, but has missed this target for years. Most recently, the second wave of pandemics and renewed lockdown measures had slowed the economy and inflation development. During the crisis, the monetary authorities launched extensive aid programs to maintain the flow of credit and to ensure favorable financing conditions. In December they topped up their billion dollar bond purchase program PEPP again.
