growth in Consumer prices in The eurozone rose to another area record in August, official Data showed on Wednesday, beat expectations and bolstered the case for in addition to big European Central Bank (ECB) rate Even before prices peak near the bend of The year.
Mainly driven by the rise in energy prices due to the Russian war in Ukraine, inflation in 19 European countries using The euro currency rose to 9.1%. in August, up from 8.9% in July , latest The statistics of the European Union statistics agency Eurostat said.
Consumer price The CPI remains good clear of The European Central Bank’s 2% target and distinguishes highest levels since then record-save for Euro started in 1997.
the prices also rising in a lot of others countries Russia’s war in grinds ukraine onresulting in unprecedented increases for Energy and food that put pressure on the family’s finances. This summer saw a wave of Protests and strikes around world pay workers for higher wages and people feed it up with higher cost of living.
inflation in Britain, Denmark and Norway, which have their own currencies, are also height, according to official The data was released earlier this month.
inflation also high in United States, adding urgency for The Federal Reserve (Fed) to continue raising interest rates. Prices were up 8.5% in July comparison with a year earlier, although that was less than 9.1% in Jun.
In the euro area, energy costs remained driver of Prices but inflated food also It rose in a double-digit area. Energy prices rose 38.3%, while food prices rose 10.6%, according to preliminary Eurostat estimates. Non-energy industrial commodities, special focus for European Central Bank, showed 5% price dash and cost of Services rose 3.8%.
look darker
numbers only add To the concerns of the European Central Bank during its gears up for else big rate to rise next A week, but the outlook is bleaker.
Energy prices soaring before start of Heating season and its reflection of Some German subsidies approx ensure That inflation will continue climb It exceeds 10% before peaking at the bend of The year.
But more Most importantly, keep a close eye on the primary price growthwho filters out The volatile food and energy prices continued to rise, indicating that speed price growth spread across economy.
Inflation excluding food and fuel prices jumped to 5.5% from 5.1% while it was a narrower measure, which also Excluding alcohol, tobacco rose to 4.3% from 4%.
Inflation likely to rise sharply next month, heading toward 10%, as some energy mitigation measures come to an end in Germany,” said UniCredit in Note before the data is released.
all of this adds for the case for a big rate European Central Bank raised on September 8 and numbers favor a growing camp of policy hawk looking for Exceptionally great height.
Some ECB policymakers are making the case for 75 basis points increase in deposit ratewhich now stands at zerowhile others argue for a more modest increase in Line with 50 basis points in July move.
markets also split with Stakes now lean towards 75 basis points But he still considers it an open question.
Still, regardless of September decisionThe direction of Travel for policy crystal looks rates clear.
With high rates of inflation for So long, it’s now in risk of take hold, so interest rates will continue climbprobably in all three remaining ECB meetings this year.
rates should hit The so-called neutral level, which does not stimulate nor slows The economy about the role of The year The only question is whether the ECB will exceed this level.
like this decision Months later, however, the mass will likely be so in By then, stagnation due to rising energy costs on output and consumer spending.
That will force The European Central Bank to reassess its position and consider whether deflation is sufficient of deflationary force to me arrest consumer price growth or frank policy Tightening still needs to be done.
