Core inflation (net of fresh food and energy) was running at 7.1% year-on-year on the HICP index in February, up from 6.6% the month before.
Italy, which is highly dependent on imports for its energy
needs, has seen inflation rise faster than many of its euro zone
partners as international gas prices have soared.
Now gas costs are declining, Italian inflation should fall
more steeply than in most of the euro zone, said Loredana
Federico, chief Italian economist at UniCredit.
ISTAT data confirm the ongoing deceleration, said Federico,
with energy prices slowing to a rise of 28.2% year-on-year last
month from 42.8% in January.
She noted that the surprise compared to UniCredit's
expectations "mainly affected the food price component, with
growth remaining sustained in February. In particular, the
downward trend in prices of fresh food on a year-on-year basis
was interrupted".
Official statistics agency ISTAT also reported that the main
domestic price index (NIC),stood at 9.2% annually in February,
decreasing from a 10.0% annual rate in January.
It was not only in Italy that prices fell less than
expected.
Euro zone inflation eased to 8.5% in February from 8.6% a
month earlier, above expectations for 8.2% in a Reuters poll of
economists, and the underlying inflation, an indicator closely
watched by the European Central Bank, jumped to 5.6% from 5.3%
in January.
"The latest HICP figures make grim reading for the ECB and
bring a 75bp rate hike into play for the upcoming meeting on 16
March", said Ken Wattret, Head of European Analysis and Insights
at S&P Global Market Intelligence.
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ITALY'S DISINFLATION ITALY'S CORE INFLATION ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
(Reporting by Antonella Cinelli, editing by Alvise Armellini
and Keith Weir)
