The annual inflation of the Eurozone continued to increase from July to August, slightly exceeded the analysts’ expectations
In August, the annual inflation in the Eurozone was 9.1%, which hit a new historical high. In July, the annual price increase was still 8.9%.
The Core inflation increased to 4.3% on an annual basis in August compared to 4% in July. The acceleration in the core inflation (fluctuating energy and food prices are not taken into account) shows that wide range of product categories are affected. Additionally the inflation rate is well above the ECB’s 2% inflation target.
According to Eurostat’s report, energy prices are the outliers in the euro zone, rising by 38.3 % on an annual basis in August. In July, this figure still was 39.6 % on an annual basis. The food prices climbed by 10.6%, manufactured goods by 5%, and services by 3.8% on an annual basis. The inflation in the Eurozone remains supply-side, this in particular put pressure on energy prices affecting manufactured goods and services.
Inflation rate by countries
Considering the inflation figures by countries, Estonia (1) has the highest inflation rate in euro zone by 25,2%, follow by Lithuania (2) (21.1%) and Latvia (3) (20.8%)
The European largest economy, Germany reached its highest level of inflation since decades with a rate of 8.8% on an annual basis in August. In France, the inflation rate surged by 6.5% in August, down from 6.8% in July. The Spanish inflation increase slowed down to 10.3% on an annual basis in August, compared to 10.7% a month ago.
The next interest rate meeting will be hold by the European Central Bank on Sept 9, the analysists expect rise in key interest rate by at least 50 points.
Source: CNBC