Eurozone: Inflation continues to ease in June
June 30, 2017
Harmonized inflation continued to fall in June, according to a flash estimate released by Eurostat on 30 June. Harmonized inflation was 1.3%, down from May’s 1.4% but slightly above market expectations of a 1.2% reading. June’s reading brought inflation further below the ECB’s target of just under 2.0%, which will reduce pressure on the Bank to end its ultra-loose stance.
According to Eurostat, the main contributor to June’s deceleration was a softer rise in energy and food, alcohol and tobacco prices. On the other hand, prices for services and non-energy industrial goods rose at a faster rate than in May. Core inflation increased to 1.2%, up from May’s 1.0%, due to the unexpected rise in the price of services. Month-on-month price variations and a more detailed set of data will be provided on 17 July.