Portugal: Harmonized inflation eases below target in March
Latest reading: Harmonized inflation declined to 1.9% in March from February’s 2.5%. As a result, inflation dipped below the Euro area average of 2.2% and undershot the ECB’s 2.0% for the first time in seven months. The result was primarily due to a fading impact of VAT exemptions and an energy price hike introduced last year. Looking at the details of the release, softer price pressures for transport and hospitality, outweighed accelerating price pressures for food.
As a result, the trend eased, with annual average harmonized inflation edging down to 2.6% from February’s 2.7%. Meanwhile, consumer price inflation edged down to 2.4% in March from February’s 2.5%.
Finally, harmonized consumer prices rose 1.77% in March over the previous month, swinging from the 0.07% fall recorded in February and marking the sharpest increase in a year.