Cyprus recorded the lowest inflation rate in the eurozone in December, with consumer prices estimated to have risen by 0.1 per cent year on year, unchanged from November, according to preliminary data released by Eurostat on Wednesday.

The figure contrasts with developments at euro area level, where annual inflation is expected to have eased to 2 per cent in December, from 2.1 per cent in November. 

Among the larger economies, inflation in December was estimated at 2.8 per cent in Germany, 3.1 per cent in Spain and 3.7 per cent in France, while Italy, by contrast, recorded a significantly lower rate of 0.7 per cent. 

Looking at the main components of euro area inflation, services continued to post the highest annual rate, seen earlier in the autumn.  

In October, services inflation stood at 3.4 per cent, up from 3.2 per cent in September. 

In December, services inflation is again expected to have reached 3.4 per cent, slightly lower than the 3.5 per cent recorded in November. 

Eurostat further reported that food, alcoholic beverages and tobacco followed a similar path.

After easing from 3 per cent in September to 2.5 per cent in October, inflation in the category higher toward the end of the year, reaching an estimated 2.6 per cent in December, compared with 2.4 per cent in November.

By contrast, non-energy industrial goods continued to show weakening price pressures.  

Inflation in the category slowed from 0.8 per cent in September to 0.6 per cent in October, before easing further to 0.4 per cent in December, down from 0.5 per cent a month earlier. 

After posting an annual fall of 1 per cent in October, compared with minus 0.4 per cent in September, energy inflation turned more negative in December, with prices estimated to have fallen by 1.9 per cent year on year, compared with a 0.5 per cent decline in November.