OECD annual inflation slows to 1.1% in December 2014 reflecting sharp fall in energy prices

Annual inflation (Consumer Price Index) in the OECD area slowed to 1.1% in the year to December 2014, compared with 1.5% in the year to November. This decrease was entirely caused by further falls in energy prices which declined by 6.3% in the year to December compared with a decline of 2.2% in the year to November. Food price inflation remained stable at 2.5% in the year to December. Excluding food and energy, the OECD annual inflation rate was also stable at 1.8% in December.

Annual inflation slowed or was stable in all major OECD economies in December 2014. It slowed in Canada (to 1.5%), the United States (to 0.8%), the United Kingdom (to 0.5%), Germany (to 0.2%) - where the latest flash estimate for January 2015 points to a further decline to -0.3% -, France (to 0.1%) and in Italy (to 0.0%). Annual inflation was stable in Japan (at 2.4%) in December 2014.

In the Euro area, annual inflation (as measured by the HICP) declined to -0.2% in December 2014. Inflation excluding food and energy slightly rose to 0.8%. The Eurostat's flash estimate for January 2015 points to a further decline to -0.6% of the annual inflation, and to a moderate slowdown, to 0.6%, of the annual inflation excluding food and energy.

Annual inflation in the G20 area was at 2.8% in December 2014. Excluding the re-integration of Argentinian data, annual inflation would have been 2.5% in December 2014, as compared to 2.4% in November 2014 3. The G20 CPI aggregate reflects diverging patterns among the world's largest economies. Annual inflation further increased in the Russian Federation (to 11.4%), Indonesia (to 8.4%) and India (to 5.9%) and to a lesser extent in China (to 1.5%). On the other hand, annual inflation slowed in South Africa (to 5.3%), Brazil (to 6.4%) and Saudi Arabia (to 2.4%).

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