Flash March Italian HICP inflation fell by -0.1% yoy after its reading of 0.1% in February. Even though the energy component rose from -8.4% yoy to -6.5% yoy, adding 19bp to the headline numbers, and food prices added a further 6bp, these effects were nullified by the deceleration in goods and services prices.
The services prices component fell from 0.7% yoy in February to 0.4% yoy in March, cutting 13bp, while the non-energy industrial goods component fell from 0.6% yoy to 0.3%, cutting a further 8bp.
According to Societe Generale estimates, Italian HICP inflation to average 0.3% in 2015 and 1.6% yoy in 2016. The core component should average 0.6% in 2015 and 1.1% in 2016.
