Eurozone inflation rises again in June, expected to reach 2 percent

Brussels – Inflation in the euro area rose in June. The plus sign in front of the cost-of-living index is 0.1 percentage points, bringing the overall headline figure to 2 percent, compared to 1.9 percent in May. According to preliminary data released by Eurostat today (1 July), there was an increase for services (3.3 percent, compared to 3.2 percent in May) and for energy (-2.7 percent, compared to -3.6 percent in May).  There was a slight decline for food, alcohol, and tobacco (3.1 percent, compared with 3.2 percent in May), as well as non-energy industrial goods (0.5 percent, compared with 0.6 percent in May). 

Among the major eurozone economies, the expected inflation trend should not impact the headline rate in Italy, which is expected to remain stable at 1.7 percent. In contrast, Germany is expected to record a slight decline, bringing the German figure in line with the eurozone average. On the other hand, France and Spain recorded an increase, in both cases exceeding the overall figure (+0.2 percentage points).

Final data will be available on 17 July, i.e., one week before the Governing Council meeting of the European Central Bank to decide about interest rates. ECB President Christine Lagarde has hinted they could remain unchanged after the last cut in early June. At that time, the central bank made clear that those levels could be adequate for the coming months, suggesting a possible pause.