Inflation in the eurozone picked up slightly in February, reaching 1.9% on an annual basis compared to 1.7% in January, according to final Eurostat data. Despite the increase, price growth remains below the European Central Bank’s 2% target for a second consecutive month this year, reinforcing expectations that interest rates will likely remain unchanged at the ECB’s upcoming meeting.

Across the wider European Union, consumer inflation also moved up marginally, rising to 2.1% from 2.0% at the start of the year. On a monthly basis, prices increased by 0.6% both in the euro area and across the EU.

In Bulgaria, annual harmonized inflation eased to 2.1% in February from 2.3% a month earlier and was significantly lower than the 3.9% recorded in February 2025, marking the lowest level since December 2024. Monthly inflation in the country rose modestly by 0.2%. At the same time, 15 EU member states reported stronger increases in consumer prices during the same period.

The highest inflation rates in February were observed in Romania at 8.3%, followed by Slovakia with 4.0%, Croatia at 3.9%, Lithuania at 3.3%, Estonia at 3.2%, and Greece at 3.1%. In contrast, the lowest levels were recorded in Denmark at 0.5%, Cyprus at 0.9%, the Czech Republic at 1.0%, France at 1.1%, and Belgium at 1.4%.

Within the euro area, services continued to drive inflation, with prices in the sector rising by 3.4% year-on-year in February after a 3.2% increase in January, pointing to persistent underlying pressures. Food prices grew by 2.5%, slightly slower than the 2.6% increase recorded a month earlier.

These trends are keeping the ECB cautious, particularly as energy prices, including natural gas, have recently risen amid the ongoing conflict involving the United States, Israel, and Iran. While the central bank is not currently moving toward higher interest rates, the evolving situation in the Middle East could influence future decisions, leaving the possibility of rate increases later in the year open depending on how long the tensions persist and how strongly they affect energy costs.