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Euro Area inflation surges to near-10-year high

EUROZONE DATA

Eurozone HICP surged to an annual rate of 3.0% in August, according to flash data released by Eurostat on Tuesday, far exceeding analysts' expectations of a jump to 2.7% from 2.2% in July.

  • That matches the highest rate of inflation since November 2011; inflation hasn't been higher since touching 3.2% in October 2008.
  • Energy prices accounted for much of the increase, rising by 1.0% between July and August and by 15.4% over the same month 2020. Excluding energy, food, alcohol and tobacco, core inflation surged to an annual rate of 1.6% from 0.7% in July, but remained below the European Central Bank's 2.0% target.
  • The higher-than-expected result follows a string of upside surprises in member-state inflation rates.
  • The outturn could lead to some vigorous debate at next week's European Central Bank meeting, with some central bank heads publicly querying the ECB forecast of transient above-target inflation.

MNI London Bureau | +44 203-865-3812 | les.commons@marketnews.com
MNI London Bureau | +44 203-865-3812 | les.commons@marketnews.com

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