Inflation is finally showing signs of returning to the eurozone after figures from January suggested consumer prices had risen to their highest level since October 2014. Headline inflation in the 19-country bloc rose to 0.4pc at the start of the year, according to a flash estimate from Eurostat, up from 0.2pc in December. More encouragingly for Europe's policymakers, core inflation - which strips out the impact of volatile elements such as energy - also inched up to 1pc from 0.9pc at the end of 2015. Paul Ashworth, chief US economist at Capital Economics, called the slowdown “a temporary blip” and would likely rebound next quarter. Next Friday the Labor Department will release its latest jobs report and the US is expected to have added another 210,000 in January. “People love doom and gloom. We had this the same time last year,” said Ashworth. “But GDP grew 2.4% last year and 2.4% the year before, that’s pretty good. It’s been enough to drive the unemployment rate down to 5% from 10% [at the peak of the recession].”A boost this year is expected to come mainly from consumer spending, which typically fuels about two-thirds of economic activity. Continued solid job growth could embolden consumers to spend more. Personal consumption accounts for more than two-thirds of GDP and rose 2.2% in the fourth quarter, down from 3% in the third quarter. The Federal Reserve issued a cautious assessment of the economy this week, leaving interest rates unchanged after raising its benchmark short-term rate in December from record lows. 
Access Investments-Building Awareness - European Union-ROMANIA
Wednesday, February 3, 2016
Inflation is finally showing signs of returning to the eurozone after figures from January suggested consumer prices had risen to their highest level since October 2014. Headline inflation in the 19-country bloc rose to 0.4pc at the start of the year, according to a flash estimate from Eurostat, up from 0.2pc in December. More encouragingly for Europe's policymakers, core inflation - which strips out the impact of volatile elements such as energy - also inched up to 1pc from 0.9pc at the end of 2015. Paul Ashworth, chief US economist at Capital Economics, called the slowdown “a temporary blip” and would likely rebound next quarter. Next Friday the Labor Department will release its latest jobs report and the US is expected to have added another 210,000 in January. “People love doom and gloom. We had this the same time last year,” said Ashworth. “But GDP grew 2.4% last year and 2.4% the year before, that’s pretty good. It’s been enough to drive the unemployment rate down to 5% from 10% [at the peak of the recession].”A boost this year is expected to come mainly from consumer spending, which typically fuels about two-thirds of economic activity. Continued solid job growth could embolden consumers to spend more. Personal consumption accounts for more than two-thirds of GDP and rose 2.2% in the fourth quarter, down from 3% in the third quarter. The Federal Reserve issued a cautious assessment of the economy this week, leaving interest rates unchanged after raising its benchmark short-term rate in December from record lows. 
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