Core Deceleration In Portugal and Ireland

The February flash inflation prints from two of the smaller Eurozone countries (Portugal and Ireland) showed a softening in core inflation (ex-energy and unprocessed food), somewhat in contrast to the French/Spanish/German country releases earlier:

Portugal: 2.5% of the 2024 HICP basket.

Portuguese flash February HICP inflation decelerated to 2.3% Y/Y (vs 2.5% prior). The monthly reading was 0.2% M/M (vs -0.2% prior).

• Headline CPI was 2.1% Y/Y (vs 2.3% prior) and 0.1% M/M (vs 0.0% prior).
• Core CPI (ex-energy/unprocessed foods) also moderated to 2.2% Y/Y (vs 2.4% prior).
• Base effects meant that energy CPI rose to 4.3% Y/Y (vs 0.2% prior) but unprocessed foods CPI fell to 0.8% Y/Y (vs 3.1% prior).
• Processed food CPI moderated to 1.3% Y/Y (vs 2.2% prior).

Ireland: 1.7% of the 2024 HICP basket.

Irish flash February HICP also decelerated, to 2.2% Y/Y (vs 2.7% prior) and 0.9% M/M.

• Energy base effects remain a key driver of disinflation but, with energy HICP falling -6.3% Y/Y (vs -7.0% prior). Food prices also moderated to 3.7% Y/Y (vs 4.3% prior).
• HICP ex-energy and unprocessed foods moderated to 3.1% Y/Y (vs 3.8% prior).