BRUSSELS, Jan 7 (Reuters) - Euro zone inflation accelerated as expected in December, an estimate from the EU statistics office Eurostat showed on Tuesday, while retail sales turned out stronger than predicted in a sign of rising household demand.
Eurostat said consumer prices in the 19 countries that share the euro rose 1.3% year-on-year in December for a 0.3% gain on the month. The year-on-year rise matched forecasts of economists polled by Reuters, accelerating from 1.0% in November.
Inflation's faster growth was mainly due to a 0.2% year-on-year increase in energy prices, which were down 3.2% the previous month.
Also unprocessed food prices rose 2.1% year-on-year accelerating from a 1.8% rise in November. Without the two volatile components, inflation was steady at 1.4% in December.
An even narrower measure which also excludes alcohol and tobacco prices, often influenced by government changes in the excise tax, was also steady at 1.3% year-on-year.
The European Central Bank wants to keep headline inflation below, but close to 2% over the medium term and carefully watches the core inflation measure excluding unprocessed food and energy in its policy decisions.
Separately, Eurostat said that retail trade, an indicator of household demand, was much stronger than expected in November, rebounding from two consecutive month-on-month falls with a 1.0% rise that produced a 2.2% year-on-year gain.
Economists polled by Reuters had expected only a 0.6% monthly increase and a 1.3% annual rise.
Eurostat also revised upwards its October figures to a smaller monthly decline of 0.3% from the previously reported 0.6% fall and a year-on-year rise of 1.7% rather than the previously reported 1.4%. (Reporting by Jan Strupczewski; editing by Francesco Guarascio)