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Euro zone May inflation confirmed at 6.1% yr/yr, core eases
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BRUSSELS (Reuters) – Euro zone consumer inflation sharply decelerated in May, the European Union’s statistics office confirmed on Friday, with the core price growth measure, watched closely by the central bank, also slowing.
Eurostat confirmed its earlier estimates that consumer in the 20 countries did not change at all month-on-month in May resulting in a 6.1% rise year-on-year, down from 7.0% year-on-year in April.
The contribution from energy prices, long the main driving force of inflation, was negative in May at 0.09 points and the main driver became the cost of food, alcohol and tobacco which added 2.54 points to the final figure.
The second biggest contributor was the rising prices of services, adding 2.15 points, with industrial goods adding another 1.51 points.
The European Central Bank wants to keep inflation at 2 percent over the medium term and has been raising interest rates quickly since the middle of last year to curb inflation.
The ECB raised interest rates again on Thursday to a 22-year high of 3.50% and said it would move again in July, continuing what has been the fastest pace of monetary tightening in the bank’s quarter century existence.
(Reporting by Jan Strupczewski)
Inflation is the rate at which the general level of prices for goods and services rises, eroding purchasing power. It is often measured as an annual percentage increase.
The European Central Bank (ECB) is the central bank for the euro and administers monetary policy within the Eurozone, aiming to maintain price stability.
Core inflation measures the long-term trend in price levels by excluding volatile items like food and energy prices, providing a clearer view of inflation trends.
Monetary policy is the process by which a central bank manages the money supply and interest rates to influence economic activity, inflation, and employment.
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