The initial reading for January euro area annual inflation is forecast to see a second successive monthly rise. While oil prices fell in January, they dropped by even more at the same point last year. That should allow the headline rate to move up to 0.4% (from 0.2%), still well below the ECB's inflation target.
The core rate is expected to be unchanged at 0.9%. Such an outturn is unlikely to reduce the odds of the ECB introducing further stimulus measures potentially as early as its next meeting in March.
"The ECB would have been expecting an even larger pickup in January inflation before the latest oil price fall. It will also be aware that inflation could start to decline once again over the next few months unless the oil price rebounds", notes Lloyds Bank.


BOJ Holds Interest Rates Steady Amid Middle East Uncertainty
Bank of Japan Governor Signals Gradual Progress Toward 2% Inflation Target
ECB Eyes Rate Hike Amid Iran Conflict-Driven Energy Price Surge
China Holds Benchmark Loan Prime Rate Steady for Tenth Consecutive Month
Fed Holds Rates Steady as Middle East Conflict Clouds Inflation Outlook
J.P. Morgan Now Expects Two ECB Rate Hikes Amid Inflation Pressures
Oil Prices Plunge Over 6% as Middle East Ceasefire Hopes Ease Supply Fears
WTO Reform Talks Begin in Cameroon Amid Global Trade Tensions
Gold Prices Fall Amid Rate Jitters; Copper Steady as China Stimulus Eyed
Federal Reserve Balance Sheet Reduction: Brookings Research Outlines Possible Path Forward




