Consumer prices in the eurozone increased faster than analysts predicted in July, maintaining an annual inflation rate of 2.0%, according to preliminary data released by Eurostat.
The figure matched June’s inflation pace. Economists surveyed by Reuters had expected inflation to ease slightly to 1.9%.
Core inflation, which excludes energy and unprocessed food, remained unchanged at 2.3%.
This measure is closely watched by the European Central Bank, as it removes volatile components and is seen as a more stable indicator of underlying price trends.
Energy prices fell by 2.5% compared to the same month last year. However, prices for unprocessed food rose by 5.4%, services by 3.1%, and industrial goods by 0.8%.
The slowdown in services inflation is attributed to easing wage pressures, according to Eurostat.
The ECB’s medium-term price stability target is set at 2.0%. Since March, headline inflation has hovered near this level.
Markets no longer expect the ECB to cut its key interest rates again this year.
“Inflation has remained around the ECB’s target since March, and the resolution of trade tensions has reduced economic risks. Unless a new shock hits the economy, another rate cut this year appears unlikely,” said Tuuli Koivu, chief economist at Nordea.
Among member states, the highest annual inflation was recorded in Estonia at 5.6%, followed by Croatia and Slovakia, both at 4.5%.
Among the eurozone’s largest economies, Germany’s inflation rate stood at 1.8%, France at 0.9%, Italy at 1.7%, and Spain at 2.7%.
In Finland, consumer prices rose by 2.0% compared to July 2024.
HT
