BRUSSELS (Reuters) - Euro zone core inflation was higher than initially forecast, the European Union’s statistics office said on Wednesday, while confirming its estimate for the headline figure.
Eurostat confirmed inflation in March in the 19 countries sharing the euro slowed down to 1.5 percent year-on-year from a four-year high of 2.0 percent recorded in February.
But core inflation, which excludes volatile prices of energy and unprocessed food and which the European Central Bank monitors closely, was revised up to 0.8 percent year-on-year in March from an earlier estimate of 0.7 percent.
The core figure remained, however, lower than the 0.9 percent recorded in February.
On a monthly basis, headline inflation was 0.8 percent in March, in line with market expectations, while core inflation was 1.2 percent higher, below the average forecast in a Reuters poll of 1.3 percent.
The revised core data may slightly strengthen the hand of those who support winding down the ECB monetary stimulus, although inflation remains below the central bank’s target of inflation close but below 2 percent over the medium term.
The ECB has slashed interest rates into negative territory and adopted a bond-buying program worth 2.3 trillion euros ($2.46 trillion) to counter the threat of deflation and revive growth in the 19-member currency bloc.
Overall inflation was lower primarily because energy prices rose by only 7.4 percent year-on-year from 9.3 percent in February. In its earlier estimates, Eurostat said energy prices went up 7.3 percent in March.
The statistics office confirmed prices for food, alcohol and tobacco went up by 1.8 percent in March, from a 2.5 percent increase recorded the previous month.
In the services sector, the largest in the euro zone economy, prices rose by 1.0 percent in March, from 1.3 percent in February.
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Reporting by Francesco Guarascio @fraguarascio; editing by Philip Blenkinsop