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PPI Drops on Sharp Fall in Energy Prices

ITALY DATA
MNI (London)

ITALY JAN PPI -9.9% M/M; DEC +3.8% M/M

ITALY JAN PPI +11.6% Y/Y; DEC +39.2% Y/Y

  • Italian factory-gate inflation eased substantially in January, falling by -9.9% m/m and by a marked 27.6pp to +11.6% y/y.
  • The fall in PPI was largely energy based, after the -21.6% m/m plunge in energy inflation.
  • Month-on-month upticks were recorded across other subcomponents, implying that underlying price pressures continue to build: consumer goods (+0.6%), capital goods (+0.3%), intermediate goods (+0.4%).
  • This data follows last week's Eurozone PPI print which eased sharply in January, cooling a significant 9.6pp to +15.0% y/y, also chiefly due to the falling energy prices.
  • Core eurozone PPI (ex. energy) rose +1.1% m/m, slowing a more modest 1.3pp to +11.1% y/y in January, still adding to the sticky core inflation conundrum faced by the ECB.

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