The ECB is not enough, in March inflation of just 0.2%. Big cities into deflation – The Republic

MILAN – Istat confirmed the preliminary estimate on inflation: in March the prices grew by only 0.2% compared to February, but show a 0.2% decline year on year (- 0.3% in February). In short, despite the moves of the ECB and the liquidity rain with which Frankfurt is innondando markets, consumption remains firm to the pole. Of course, the acquired data for 2016 dates from -0.4% and approaches the government estimate contained in Def (+ 0.2% by year-end), but deflation affects more and more cities, spreading like wildfire throughout the national territory. The beautiful country shares the price weakness that affects the whole euro area, where the annual inflation rose to zero compared to -0.2% in February. Even in the EU, according to data from Eurostat, the annual inflation rate in March was 0% after -0.1% in February.

According to Istat are 22 large cities with falling prices on an annual basis: a month before they were 20 in February. The list also includes Roma (-0.5%), Florence (-0.4%), Naples (-0.1%) and Milan (-0.1%), but the most dramatic declines were recorded for Bari power (both -1%). On the other hand, in March deflation she has also engulfed the so-called shopping cart: the food prices, for the care of the house and of the person decreased by 0.1% compared to February and by 0.3% yoy (from -0.4% the previous month). Demand remains firm, prices fall and consumers refer purchases feeding the vicious cycle.

In detail, the persistence of the downward trend in prices is influenced by a picture of the performance of substantial stability on an annual basis of the different types product, with the exception of the further decline of energy products and in particular of non-regulated energy (-11.2%, from -8.5% the previous month), however, compensated by the reversal of the trend of related services to transport (+ 0.5%, from -0.7% in February) and other slight signs of recovery registered by the prices of some types of products, which have contributed, however, only to reduce the amplitude of the index decline general.

net of unprocessed food and energy prices, the ” Core inflation “rose to + 0.6% (from + 0.5% in February); net only energy prices are leading to + 0.4% (from + 0.3% the previous month). Compared with March 2015, the prices of goods recorded an accentuation of the decline (-1.0%, from -0.7% in February), while the growth rate of services prices accelerated (+ 0.7% from + 0.5% the previous month). As a result, compared with February 2016 inflation differential between goods and services is expanded by five tenths of a percentage point.

The harmonized index of consumer prices (HICP) increased by 2.1% on a monthly basis while decreases, as in February, by 0.2% on an annual basis (the preliminary estimate was -0.3%). The economic rise is largely due to the end of the winter sales, of which the NIC ignores. The national consumer price index for families of workers and employees (FOI), excluding tobacco, increased by 0.1% from the previous month and decreased by 0.3% against March 2015.