Italy’s inflation rate held last month at a six-month low as extended post-holiday sales more than offset the rising cost of energy products.
The inflation rate based on European Union measurements was 3.4 percent and unchanged from the previous month, Rome-based national statistics office Istat said in a preliminary report today. That matched the median forecast rate by 14 economists in a Bloomberg News survey. February prices rose 0.2 percent from the previous month.
Inflation had slowed in January for the first time in three months as Italian shops started offering post-Christmas sales. That more than offset tax increases in Prime Minister Mario Monti’s 20 billion-euro ($26.7 billion) austerity package passed in December which also raised gasoline prices by almost 10 cents a liter.
The cost of heating oil in February rose 1.1 percent from January and the price of gasoline gained 2.1 percent, today’s report said.
Inflation had slowed also in the Euro-area (ECCPEMUY) in January as the economy showed signs of contraction and governments cut spending across the 17-nation currency region. The inflation rate in the euro area rose to 2.7 percent in February from 2.6 percent in the previous month, the European Union’s statistics office in Luxembourg said today.
Based on Italian methodology, prices in February gained 0.4 percent from the previous month and 3.3 percent from a year earlier, Istat said today.
Italian household confidence increased more than economists forecast last month as an easing of Europe’s sovereign debt crisis buoyed consumer sentiment. The extra yield that investors demand to hold Italian 10-year bonds over German counterparts narrowed today to 323 basis points after hitting a euro-era record of 576 basis points on Nov. 9.
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