Eurozone inflation slows to 2.4% in February

The eurozone's annual inflation rate is estimated at 2.4 percent in February, down slightly from 2.5 percent in January, according to a flash estimate released by Eurostat on Monday, reported Xinhua.

Services are expected to record the highest annual inflation rate at 3.7 percent, down from 3.9 percent in January. Inflation for food, alcohol, and tobacco rose to 2.7 percent from 2.3 percent, while non-energy industrial goods inflation edged up to 0.6 percent from 0.5 percent. Energy inflation, however, saw a sharp decline from 1.9 percent to 0.2 percent.

Among individual eurozone economies, Estonia recorded the highest inflation rate of 5 percent in February, followed by Croatia at 4.7 percent, Belgium at 4.4 percent, and Slovakia at 4 percent.

Bert Colijn, an ING economist, noted that while businesses are facing rising input costs, weak domestic demand has limited their ability to pass these costs on to consumers. Despite improved purchasing power, economic uncertainty has led to a rise in the savings rate.

Looking ahead, the eurozone economy is expected to gradually recover from stagnation as domestic demand strengthens, supported by improved purchasing power and lower interest rates. However, Colijn cautioned that geopolitical risks, including trade tensions and energy price volatility, continue to pose challenges to the inflation outlook.