Data released by Eurostat earlier on Thursday showed that eurozone CPI inflation recorded a 0.6 percent monthly decline, which was slightly larger than the 0.5 percent expected.
Advertisement
European Central Bank will likely be disappointed over near-term trends in inflation, especially the decline in underlying prices on the month. Until the annual figure posted a 0.1 per cent rise in June, prices had not risen in the 19 countries using the euro since January. The narrower inflation indicator, which excludes energy, food, alcohol and tobacco products, rose an unchanged 0.9 per cent.
Annual inflation reached an eight-month high in the Eurozone in July, supported by higher prices at restaurants and cafes which helped to offset declines in transport fuels and heating oil. The lowest annual rates were registered in Bulgaria and Croatia (both -1.1%) and Slovakia (-0.9%).
The rate of inflation in the services sector increased to 1.2% from 1.1% previously, while prices of industrial goods rose 0.4% over the year.
Prices of fruit were 6.4 percent higher than in July past year and vegetables 5.6 percent more expensive.
Advertisement
The main contribution for the surprise results arrived from non food stores, where there was a hike of volume of sales just under 2.5%, in total there was a surge of 5.9% in sales, while there was a 2% fall in average store prices including petrol stations year on year, and 0.8% between June and July. The highest annual rates were recorded in Belgium (2.0%), Sweden (1.1%) and Malta (0.9%).
