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European inflation rate falls for second straight month

While prices for energy, goods and services remain higher than what was recorded in 2021, inflation is trending downward since reaching a high last October.

(CN) — The annual inflation rate in both the eurozone and European Union has declined more than 1% since hitting highs in October 2022, but is still well above rates recorded at the end of 2021.

In December, the 20-nation eurozone experienced an annual inflation rate of 9.2%, which is down from 10.6% in October but still nearly twice the 5% inflation rate recorded one year prior.

Across the 27 EU member states, the annual inflation rate was 10.4% in December, down from a high of 11.5% in October but still well above the 5.3% reported in December 2021.

Annual inflation is the change in the price level of consumer goods and services between the current month and the same month of the previous year. According to data published Wednesday by Eurostat, the EU statistics agency, Hungary is currently experiencing the highest inflation in the region at an annual rate of 25%. On the other end of the spectrum is Spain, where the yearly rate was recorded at a low 5.5% in December. 

Nineteen countries had rates above the eurozone average in December, while Finland, Ireland, Cyprus, Greece, Malta, France and Luxembourg joined Spain with below-average inflation. Since November, annual inflation fell in 22 countries and remained stable in Czechia, Spain and Malta, while the rate actually increased 2.1% in Sweden, 1.8% in Hungary, and 0.8% in Bulgaria. 

Inflation is being led by a 25.5% increase in the cost of energy products, including electricity and natural gas, but prices have also soared 14.3% for processed foods, alcohol and tobacco, 12% for unprocessed food, 6.4% for non-energy industrial goods and 4.4% for services. 

Comparatively, the annual inflation rate in the United States was recorded at 6.5% in December 2022, according to the Bureau of Labor Statistics, led by a 15.6% increase in energy services including electricity and natural gas, a 10.4% increase in food costs and a 7% increase in non-energy services. 

Throughout 2022, the eurozone - comprised of the nations that use the euro as their form of currency - included Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Portugal, Slovenia, Slovakia and Spain. The bloc added a new member Jan. 1, when Croatia adopted the currency. 

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