Eurozone consumer prices were slightly higher on the year in June as preliminary data released by the EU’s statistics agency showed that consumer prices were 0.1 per cent higher than in June 2015, offsetting a 0.1 per cent fall in May. Economists surveyed by The Wall Street Journal expected prices to be unchanged on the year.

The latest figures underline the difficulty of boosting inflation at a time of weak demand growth not just in the Eurozone but around the world. Prices first fell below their year-earlier levels in December 2014 and the Eurozone has drifted in and out of deflation ever since. Core inflation that excludes energy, food, alcohol and tobacco rose to 0.9 per cent in June from 0.8 per cent in May. This was the fastest rate since March.

In the meantime, German unemployment continued to fall in June, indicating that economic growth remained strong before Britons unexpectedly voted to exit the European Union. The number of people out of work in Europe’s largest economy fell by a seasonally adjusted 6,000 to 2.69 million, data from the Federal Labor Agency showed last week. The median estimate of economists surveyed by Bloomberg was for a drop of 5,000.

The jobless rate remained unchanged at a record low of 6.1 per cent. This was the lowest since German reunification. German companies shrugged off the risk of the UK quitting the EU before the June 23 referendum, with business confidence rising to the highest level since November and private-sector growth accelerating to the fastest pace this year.

Finally, in the US, a survey published last week showed that consumers’ confidence in the US improved by much more than anticipated in June as a key measure hit its highest level since October. The conference board said that the consumer confidence index jumped to 98.0 in June.

Economists had been expecting the consumer confidence index to hit 93.7, up from May’s revised figure of 92.4. Lynn Franco, director of economic indicators at the Conference Board, said that, notwithstanding the rise in June’s outcomes, consumers were still “cautiously optimistic” about economic growth in the short term.

This report was compiled by Bank of Valletta for general information only.