Consumer prices in Italy rose by more than expected last month, as the eurozone’s third largest economy continues to claw its way out of a deflationary year in 2016.

Inflation rose 1.6 per cent in February compared to the same period in the previous year, ahead of expectations of a 1.3 per cent rise, according to a flash estimate for harmonised consumer price inflation from Italian stats agency Istat.

The figure follows a 1 per cent year-on-year rise in inflation in January, the country’s highest inflation rate since 2013 after experiencing its first year of outright deflation in nearly 70 years in 2016.

Monthly inflation was also unexpectedly positive, with consumer prices rising 0.2 per cent in February from the previous month, against expectations of a 0.1 per cent drop.

Figures yesterday showed Spanish prices rose at their fastest level since 2012 in February, rising 3 per cent on an annual basis, according to flash estimates, to mark a fresh four-year high for the eurozone’s fourth largest economy.

The Italian and Spanish figures are in line with the upward inflation trend across the eurozone, with average inflation across the single currency bloc at its highest level since 2012, hitting 1.8 per cent in January.

The Paris-based Organisation for Economic Co-operation and Development warned this month that Italy was suffering from “chronically low productivity growth” that has pushed down living standards and kept a lid on higher growth and urged the country to revamp its labour and welfare laws

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