Inflation slows to 2.4 percent

Consumer price inflation decelerated to a 2.4 percent annual pace in January, lower than expected, as the economic downturn prompts companies to keep prices low, according to data released by the National Statistics Service (NSS). Economists were expecting inflation to accelerate to 2.7 percent year-on-year in January from 2.6 percent in the previous month. Consumer inflation was down 0.7 percent month-on-month. »It seems that the impact of weaker activity, which dents firms’ pricing power, is being stronger than the impact of the negative base effects stemming from oil prices and higher taxes,» IHS Global Insight economist Diego Iscaro told Reuters. »In a way, the fact that inflation is not as high as expected is positive news, as a surge in inflation would put private consumption under intense pressure,» he said. Despite the dip, Greece’s consumer price index remained well above levels seen in the 16-nation eurozone where inflation rose 1 percent in January.

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