Consumer prices provisionally rose just a monthly 0.1 percent in February. This was small enough to reduce the annual inflation rate from 0.9 percent to 0.6 percent, its weakest mark since December 2016.
The flash HICP fell 0.3 percent versus January to put its 12-month rate at 0.7 percent, a sizeable 0.5 percentage point drop from its final outturn at the start of the year.
However, the monthly deceleration in the headline annual CPI rate was almost wholly attributable to the more volatile basket components. In particular, non-processed food (minus 3.2 percent after 0.4 percent) and regulated energy (5.2 percent after 6.4 percent) weighed significantly. Consequently, the core measure, which excludes fresh food and energy, held up much better and even showed a modest 0.1 percentage point increase to 0.7 percent.
Nonetheless, even allowing for the downside bias from food and energy, Italian inflation remains very soft. The underlying trend has been flat for some time now and there has been little in recent economic data to suppose that this will change anytime soon.