Financial News: Eurozone Inflation Slows To 5.2%

Eurozone Inflation Slows To 5.2%

(RTTNews) - Eurozone inflation slowed unexpectedly in August, revised data from Eurostat showed on Wednesday.

Consumer price inflation for August was revised down to 5.2 percent. Initially, the rate was seen at 5.3 percent, unchanged from July.

However, core inflation that excludes prices of energy, food, alcohol and tobacco, was confirmed at 5.3 percent. The core rate eased from 5.5 percent in July.

On a monthly basis, the harmonized index of consumer prices gained 0.5 percent in August.

At the September meeting, the <a href=https://www.rttnews.com/3390463/ecb-signals-pause-after-hiking-rates-for-tenth-session.aspx target=_blank >European Central Bank</a> had raised its key interest rates for the tenth consecutive session as rate-setters assessed the inflation to remain "too high for too long", but signaled a pause.

The ECB Staff had raised the inflation projection for this year to 5.6 percent and that for next year to 3.2 percent. The forecast for 2025, however, was cut to 2.1 percent.

Last week, the <a href=https://www.rttnews.com/3389444/eurozone-to-undergo-slower-growth-on-subdued-domestic-demand-tight-policy.aspx target=_blank >European Commission</a> lowered inflation outlook for 2023 to 5.6 percent from 5.8 percent, while the forecast for 2024 was revised up to 2.9 percent from 2.8 percent, reflecting the impact of higher oil prices.

Data today showed that energy prices dropped for the fourth straight month. Prices decreased 3.3 percent, slower than July's 6.1 percent fall.

Food, alcohol and tobacco prices gained 9.7 percent after a 10.8 percent rise. Similarly, growth in non-energy industrial goods prices slowed to 4.7 percent from 5.0 percent. Services cost was up 5.5 percent, which was weaker than July's 5.6 percent increase.

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