Eurozone inflation hits two-year high

Annual inflation across the 16-member eurozone for December is expected to reach a two-year high, according to a flash estimate released by the EU’s statistics arm Eurostat.

At an estimated 2.2 per cent, the eurozone’s annual inflation rate is the highest to be registered since November 2008.

While the policy of the European Central Bank is to keep annual inflation in the eurozone below two per cent annually, December’s first estimates show this target has been surpassed.

However, according to analysts, this will not necessarily mean the ECB will increase interest rates as it is expected to keep them on the low side to help boost a still-struggling economy.

The rise in prices in December is being attributed mainly to the rising commodity prices including oil and grain.

The individual inflation rates of member states in December have not yet been released.

In November, Malta’s annual inflation rate was the second highest in the EU following Greece. It stood at 3.4 per cent against the eurozone’s average of 1.9 per cent.