Unemployment also held steady in June at a seasonally adjusted 11.1 percent, Eurostat reported Friday. Non-energy industrial goods prices and services costs gained 0.5 percent and 1.2 percent, respectively.
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When measured by the harmonized index of consumer prices (HICP), ECB’s yardstick, German inflation rate in July remained at 0.1 percent, unchanged from June.
Analysts were expecting inflation of 0.2% year-on-year and core inflation at 0.8%.
Improvement in eurozone economic activity and the weak euro are among the factors that could lift inflation going forward, he said. Final data is due on August 14. The U.K.’sFTSE 100 slipped 0.1% (http://www.marketwatch.com/storyno-meta-for-guid) to 6,661.38.
ING economist Carsten Brzeski said the recent slump in commodity prices could push headline inflation in both the euro zone and Germany back below zero temporarily. This was the lowest rate recorded in the euro area since March 2012, when it was at 11 percent.
“Following the steady German inflation rate on Thursday, the likelihood that the bloc’s CPI will meet the forecast is high”, said Marshall Gittler, head of global FX strategy at IronFX, in a note.
The overall number of people unemployed in the euro area increased by 31,000 compared with May.
In June, the eurozone saw an inflation rate of 0.2 percent, far below the ECB’s target of “below, but close to 2 percent”.
James Howat, European Economist at Capital Economics, said the figures were not positive: “Worryingly, surveys of employment intentions have weakened recently, suggesting that the labour market recovery will remain pretty weak”. According to him, the European Central Bank is likely to complete its quantitative easing programme in full, and may even extend additional monetary policy support.
German unemployment rose unexpectedly by 9,000 in July from June, the Federal Labor Agency showed Thursday.
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Among the nations that share the euro currency, Greece had the highest level of unemployment, at 25.6 percent.
