Harmonized inflation rises above target in April

Latest reading: Harmonized inflation rose to 2.1% in April from March’s 1.9%. As a result, inflation remained below the Euro area average of 2.2% but overshot the ECB’s 2.0% target. Looking at the details of the release, faster rises in housing, hospitality and transport costs outweighed softer price pressures for food. Still, a fading impact of VAT exemptions and an energy price hike introduced last year likely capped the increase. Still, the trend stabilized, with annual average harmonized inflation unchanged at March’s 2.6% in April. Meanwhile, consumer price inflation edged up to 2.1% in April from March’s 1.9%. Finally, harmonized consumer prices rose 1.30% in April over the previous month, easing from the 1.71% rise recorded in March.

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