Restaurants, rents, cigarettes push eurozone inflation up
Higher prices in restaurants and cafés as well as rents and cigarette prices pushed up eurozone inflation in September, data showed yesterday, offsetting the downward pull on the index from cheap fuel and gas prices.
The EU’s statistics office Eurostat confirmed that consumer prices in the 19 countries using the euro rose 0.4 per cent month-on-month for a 0.4 per cent year-on-year gain, as expected by markets and in line with initial Eurostat estimates. The statistics agency said price rises in restaurants and cafés added 0.08 points to the overall annual result and more expensive rents and tobacco 0.05 points each.
Food, alcohol and tobacco prices rose 0.7 per cent year-on-year in September, with unprocessed food itself 1.1 per cent more expensive than 12 months earlier.
Energy prices, despite rising one per cent from August, were still three per cent lower than a year earlier. Their annual drop is much milder than in August, when energy prices fell 5.6 per cent, reflecting mounting oil prices. Without the volatile energy and unprocessed food items, or what the European Central Bank calls core inflation, eurozone prices rose 0.4 per cent on the month for a 0.8 per cent year-on-year gain – remaining steady for the fifth month running.
In September 2016, negative annual rates were observed in 10 member states. The lowest annual rates were registered in Bulgaria (-1.1 per cent), Croatia (-0.7 per cent) and Slovakia (-0.5 per cent). The highest annual rates were recorded in Belgium (1.8 per cent), Estonia (1.7 per cent) and Austria (1.1 per cent).
Compared with August, annual inflation fell in nine member states, remained stable in two and rose in 16. Malta’s rate was 0.9 per cent.
The ECB wants to keep inflation at below, but close to, two per cent over the medium term.