Inflation in the euro zone continued to slow down in March, after peaking at 2.9% in December last year. The annual inflation rate (in relation to the same month last year) fell from 2.6% in February to 2.4% in March, according to Eurostat’s flash estimate published this Wednesday.
Portugal is among the 11 economies that recorded inflation rates above the euro zone average. According to the European Union’s statistical body, inflation in March rose to 2.6% in Portugal, according to the Harmonized Consumer Price Index methodology, followed by Eurostat. In the Consumer Price Index methodology of the National Statistics Institute, inflation rose from 2.1% to 2.3%.
The most worrying situation in terms of an inflationary outbreak covers Austria, Croatia and Estonia, with rates in March still above 4%. The lowest inflation is recorded in Lithuania, at 0.3%. In Germany, the euro’s main economy, inflation slowed from 2.7% to 2.3%.
Inflation in services remains at 4%
In the components of the index, the services sector continues to show the highest level of inflation. In March it remained at 4%, a rate that has been recorded since November 2023.
The energy sector continues to see consumer prices fall, with a reduction of 1.8% in March, compared to 3.7% in February.
Inflation in services is influenced by changes in wages, due to the labor-intensive nature.
Good and bad news for the ECB
The slowdown in global inflation in the euro zone is good news for the European Central Bank (ECB). Underlying inflation (excluding the most volatile components) also slowed from 3.3% in February to 3.1% in March. Another good news for the ECB.
But inflation in services remains at 4% and the monthly variation, known as chain, accelerated slightly, from 0.6% in February to 0.8% in March. The chain variation in underlying inflation also increased from 0.7% to 1.1%. The economy with the greatest acceleration in inflation was Portuguese, with the variation registering 2.3%.
