MNI: EUROZONE DATA: Flash HICP (Jun 2019)............>

MNI: EUROZONE DATA: Flash HICP (Jun 2019)

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- As expected, EZ HICP infl held steady in Jun at May's 13-mth low of 1.2% y/y

- Core infl (HICP ex. energy, food, alcohol & tobacco) rose 0.3pp to 1.1% in Jun

- ... driven by a 0.6pp acceleration in services price inflation to 1.6% and a

milder 0.1pp rise in food inflation (also to 1.6%)

- However, the upward pressure on the headline rate from core was offset by a

sharp easing in energy inflation from 3.8% in May to 1.6%, and a softer 0.1pp

deceleration in non-energy industrial goods inflation to 0.2% 

- Looking ahead, underlying inflation is unlikely to strengthen further over the

course of the year

- Despite still-healthy domestic demand, companies are nevertheless finding it

difficult to pass on their higher wage costs to consumers...

- ... as concerns over the fragility of the economy persist

- Moreover, wage growth looks likely to level off in the coming quarters, as the

pace of hiring slows