Consumer prices rose an unrevised 0.5 percent on the month in February. This left the annual inflation rate at its provisional 1.4 percent mark, down from 1.6 percent in the final January report and its weakest print since November 2016.
The flash HICP similarly matched its flash estimates and so still shows a monthly 0.5 percent advance and a 1.2 percent yearly rate, also a couple of ticks short of its final outturn last time.
However, it was again the more volatile CPI components that were responsible for what was the third consecutive drop in the yearly rate. In particular food (1.1 percent after 3.1 percent) had a sizeable negative effect as did, to a lesser extent, energy (0.1 percent after 0.9 percent). Excluding both categories, prices were 0.5 percent higher than in January which was enough to lift the yearly core rate from 1.5 percent to 1.6 percent.
Consequently, the underlying inflation picture was rather firmer than the headline data might suggest. Even so, the uptrend in core consumer prices remains only shallow. At least in part this probably reflects the relative sluggishness of household demand which has not risen since the middle of last year.