Euro zone inflation rises slightly, ECB target still a million miles away

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Euro zone inflation rises slightly, ECB target still a million miles away

On Saturday, the 16th of February, an analysts’ poll containing economists, analysts and journalists had said that the inflation in the Euro area had raised slightly on February, yet it remained well-below ECB’s target of 2 percent and far apart from altering ECB’s decision of a delayed rate hiking.

According to European Statistics Agency, Eurostat report announced on Friday (March 15th), that the inflation in euro zone rose slightly in February to 1.5 percent on a year-on-year basis, while January delivered an inflation of 1.4 percent from a year earlier.

Eurostat report had also revealed that the inflation was mostly boosted by an increase in the energy prices, while unprocessed foods such as potatoes had also contributed to a higher pricing. According to ECB’s latest gathering, which announced a delay of another interest rate hike as late as January 2020 amid gloomier economic outlook and an imminent recession risk.

Apart from that, the European Central Bank had also slashed their inflation forecast for 2019 to 1.2 percent from previous 1.6 percent, which strongly supported ECB’s dovish stance regarding another interest rate hike.

However, a potential candidate for future ECB chief, the Finnish Federal Reserve Chair, Olli Rehn recently had attacked a downbeat stance of Draghi, arguing for an immediate reform of the monetary policy apparently as a publicity stunt, as eurozone economy couldn’t really make businesses profitable out of nowhere amid an ongoing global slowdown, alongside a basic supply and demand dead-ends.