Wednesday 28 September 2016

Euro zone inflation defies expectations, unchanged in August vs July

Published 31/08/2015 | 10:54

ECB President Mario Draghi said the risks for the euro are on the downside. Reuters
ECB President Mario Draghi said the risks for the euro are on the downside. Reuters

Euro zone inflation was the same in August as in July year-on-year, defying market expectations of a slowdown as rising prices of unprocessed food and services offset some of the downward pull from much cheaper energy, a first official estimate showed.

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The European Union's statistics office Eurostat said euro zone prices rose 0.2 percent year-on-year this month, the same as in July. Economists polled by Reuters had expected inflation at 0.1 percent year-on-year.

Cheaper energy was the biggest factor lowering the overall index, with energy prices 7.1 percent lower in August than a year earlier. Unprocessed food had the biggest upward impact on inflation as its prices rose 2.3 percent in annual terms.

Excluding both the volatile energy and unprocessed food price -- a measure the European Central Bank calls core inflation -- consumer prices rose 0.9 percent year-on-year in August, the same as in July.

Reuters

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