Eurozone inflation edged up in September, buoyed by energy costs, official data showed Wednesday, reinforcing expectations that the European Central Bank will not make further interest rate cuts this year.
Inflation rose to 2.2 per cent last month, from two per cent in August, the EU’s statistics agency said, above the ECB’s two-percent target.
The figure was in line with predictions by analysts surveyed by Bloomberg, but economists for FactSet had expected inflation to rise to 2.3 per cent.
Core inflation, which strips out volatile energy, food, alcohol, and tobacco prices, was also unchanged at 2.3 per cent, as economists for both Bloomberg and FactSet had forecast.
It remained stable despite service price rises accelerating to 3.2 per cent in September, from 3.1 per cent in August.
Energy costs, however, fell by 0.4 per cent in September — a significantly smaller decline than the 2.0 per cent recorded in August, Eurostat data showed.
Food, alcohol, and tobacco price rises eased to 3.0 per cent in September, from 3.2 per cent the previous month.
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The September figure will cement the ECB’s plans for interest rates, said Riccardo Marcelli Fabiani, senior economist at Oxford Economics.
“Only a strong surprise in inflation could spur a cut this year,” he said.
Inflation in Germany and France, the EU’s biggest economies, also accelerated in September to 2.4 per cent and 1.1 per cent, respectively, the agency said.
AFP
