PARIS - Eurozone indicators to be released this week are expected to confirm a rise in inflation for February that was signalled in preliminary figures, economists said.
Annual eurozone inflation, due out on Wednesday, is forecast to remain unchanged from the initial estimate of two percent, compared with January's 1.9 percent reading.
The European Central Bank aims to keep inflation below but close to two percent, but it was at or above that level for the final nine months of last year largely as a result of the steep rise in oil prices.
"We don't expect any revisions," Royal Bank of Scotland economists said.
But some economists forecast an upwards revision of the preliminary estimate.
"The final estimate may well be revised up to 2.1 percent," HSBC economists said.
Credit Suisse First Boston economists said that while member states' figures to date suggest a final reading of 2.0 percent, "there is however a significant risk of a revision up to 2.1 percent".
This would be dependent on France's final inflation figures, due out on Tuesday, they said.
After dipping unexpectedly to 1.6 percent in January, French inflation is forecast to edge back up, albeit remaining well below the two percent target.
"Oil prices rose strongly in February, while the very cold weather probably pushed up fresh food prices," HSBC economists said.
"Overall, we expect inflation to move back up to 1.9 percent," they said.
Credit Suisse First Boston also forecast "a small rise in the annual inflation rate".
The other key release in a light week for eurozone data, Germany's ZEW economic expectations index due out on Tuesday, is forecast to reverse its recent upward trend.
"In March, rising oil prices and euro strength probably dampened optimism and we expect expectations to fall to (an indexed) 31," HSBC economists said.
Royal Bank of Scotland economists also said the rise in oil prices and the euro "should be reflected in a slight fall in the expectations index".
By contrast, eurozone industrial output due out on Thursday is forecast to post an improvement for January, as a hefty rise in Germany offsets lacklustre performances in France and Italy and falls in the Netherlands and Spain.
"The sharp 3.1 percent month-on-month rise in German industrial output in January -- the strongest increase in a decade -- should mean euro area industrial production records one of its strongest monthly increases of recent years," Credit Suisse First Boston said.
They cautioned however that the German figure may see a reversal for February, prompting a dip in the euro zone report.
In Britain, the upcoming pre-election budget on Wednesday is set to dwarf the raft of economic data due for release next week.
Still, economic data are predicted to reveal rising cost pressures in the pipeline alongside a tight labour market. On the consumer side, retail sales are seen rising while the housing market is expected to stabilise.
The week kicks off with producer price data for February, where consensus points to a steep 11 percent year-on-year rise in producers' raw material costs.
On Wednesday, more evidence of a tight labour market is expected and market attention will be firmly fixed on the wage front.
"This is now the most important indicator in the UK, especially as the Bank of England seems to have indicated that this holds the key to the next move in interest rates," said John Butler at HSBC.
British retail sales data for February, due Thursday, are expected to show modest rises -- up 0.3 percent from January and 4.3 percent on the year.
Royal Bank of Scotland economists pointed out that on the positive side, consumer confidence held up reasonably well in the month and that the Confederation of British Industry's survey of the sector showed a modest improvement.
Meanwhile figures on government finances for February, due Friday, are unlikely to have much impact as Chancellor Gordon Brown would have already announced fiscal projections in his budget speech on Wednesday.

03/13/2005 02:49 GMT