Euro-zone inflation estimated at 2.4%

Euro-zone annual inflation is expected to be 2.4% in January 2006 according to a flash estimate issued by Eurostat, the Statistical Office of the European Communities.

It was 2.2% in December 2005.

Computation of flash estimates Euro-zone inflation is measured by the Monetary Union Index of Consumer Prices (MUICP). To compute the MUICP flash estimates, Eurostat uses early price information relating to the reference month from Member States for which data are available as well as early information about energy prices.

The flash estimation procedure for the MUICP combines historical information with partial information on price developments in the most recent months to give a total index for the euro-zone. No detailed breakdown is available.

Experience has shown the procedure to be reliable (12 times exactly anticipating the inflation rate, 11 times differing by 0.1 and once differing by 0.2, in January 2005, over the last two years).

However, the introduction in January 2006 of the new 2005=100 index reference year could affect the performance of the estimation procedure.