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MNI BRIEF: EZ Inflation Higher, Core Prices Rising Faster

Acceleration in core HICP outpaces headline increase

(MNI) LONDON
(MNI) London

Eurozone inflation edged up to an annual rate of 7.5% in April, according to flash data released by Eurostat on Friday, an acceleration from the 7.4% pace recorded in March. However, prices rose by just 0.6% between March and April, a much slower increase than the 2.4% rise between February and March.

Core inflation, closely watched by the European Central Bank, accelerated more quickly than the headline number, rising by 1.1% in April for a 3.5% annual increase, up sharply from the 2.9% gain posted in March.

The jump in underlying inflation belies the repeated insistence by ECB President Christine Lagarde that energy prices are the main contributor to above-target inflation. Last weekend, Lagarde told America’s CBS News that a rise in interest rates would do nothing to alleviate high energy costs. Nonetheless, investors believe the ECB will be forced to lift interest rates as early as its July meeting.

Source: Eurostat

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