Current Consumer Price Development in the Euroarea

The Statistical Office of the European Union publishes the inflation rate for the euro area monthly. The disinflationary trend in the EMU observed in recent years has been largely determined by a negative output gap and a decline in crude oil prices. In addition, price pressure, which had previously been the result of administered price increases in the EMU, fell sharply. Finally, the influence of indirect taxes on the consumer price level has also declined significantly. In January 2017, the inflation rate in the euro area stood at 1.8% and for the first time was just below the target of the ECB. This was primarily due to the rise in crude oil prices and the depreciation of the euro against the US dollar. In addition, prices for industrial goods (excluding energy) and processed foodstuffs have risen appreciably, and prices for unprocessed food have increased by 3.5 percent.