Euro-zone1 annual inflation2 is expected to be 2.0% in January 2004 according to a flash estimate issued today by Eurostat, the Statistical Office of the European Communities. It was 2.0% in December 20033.
Computation of flash estimates
The euro-zone inflation is measured by the Monetary Union Index of Consumer Prices (MUICP). To compute the MUICP flash estimates, Eurostat uses early price information relating to the reference month from Member States for which data are available as well as early information about energy prices.
The estimation procedure for the MUICP flash estimate issued today combines historical information with partial information on price developments in the most recent months to give a total index for the euro-zone. No detailed breakdown is available. Simulations have shown the procedure to be reliable (14 times exactly anticipating the inflation rate, 8 times differing by 0.1 and 2 times differing by 0.2 - last time in April 2002 - over the last two years). Further information can be found in Eurostat News Release 113/2001, 5 November 2001.
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