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Euro-Area Inflation at 0.7% Builds Rate Pressure on ECB

Euro-area inflation remained below half of the European Central Bank’s target in January, driven by falling energy prices, adding to the case for policy makers to cut interest rates next week.

Consumer prices rose an annual 0.7 percent after a 0.8 percent gain in December, the European Union’s statistics office in Luxembourg said today. The median estimate in a Bloomberg News survey of 41 economists was for an increase to 0.9 percent. That’s the fourth consecutive reading of less than 1 percent. The Frankfurt-based central bank aims to keep inflation at just under 2 percent.