Europe Records Ease In Inflation In January

Inflation in Europe dipped in January, giving relief to consumers.

The consumer price index for the 20 countries that use the euro currency reached 8.5% in January compared with a year earlier, European Union statistics agency Eurostat said on Wednesday.

That's down from the annual rate of 9.2% in December. Inflation in Europe has now slowed for the third month in a row, falling from a record high of 10.6% in October.

Prices for food, alcohol and tobacco rose at a 14.1% annual pace in January, while energy prices rose 17.2%.

With inflation far above its target of 2%, the European central bank (ECB) has been raising interest rates that make it more expensive for consumers to borrow money.

Aiming to get price spikes under control, the European central bank is expected to institute another half-point hike on Thursday.