Euro zone inflation got back near European Central Bank comfort levels in December, according to data today showing an annual rate of two percent, just as calls have been made for a rate cut to fight a rising euro.
European Union statistics office Eurostat released the data, which showed a surprise downward revision for December from its previous inflation estimate of 2.1 per cent. Annual inflation in November was 2.2 per cent.
Two per cent is the upper limit of the ECB's preferred inflation rate, which it wants at below but close to this level.
The euro zone December month-on-month gain was 0.3 per cent. Analysts had expected a monthly rise of 0.4 per cent.
The ECB has faced calls from some for a cut in interest rates, including German Economy Minister Mr Wolfgang Clement, to deal with a steadily rising euro. They have been at a low of 2 per cent since June.
The ECB has so far resisted calls for a rate cut, but might have to succumb to such pressure if the euro resumes a strong upward march, analysts say.
But prices seem to be developing in line with ECB hopes.