Malta registered the highest monthly increase in the cost of living in the euro area last month, according to Eurostat.

Compared to May, inflation rose by 0.6 per cent in June, reaching 3.1 per cent. The inflation rate stood at 2.5 per cent in May.

According to the EU’s statistics arm, while average inflation in the euro area remained unchanged between May and June, at 2.7 per cent, Malta’s surpassed the euro area’s average.

Still, Malta does not have the highest annual inflation rate in the eurozone. In June, annual inflation was highest in Estonia (4.9 per cent), Cyprus (4.5 per cent) and Slovakia (4.1 per cent). On the other hand, the lowest annual inflation rates last month were registered in Slovenia (1.6 per cent) and Ireland (1.2 per cent).

Following relatively low inflation rates in the euro area in the past years, particularly due to the economic crisis, the cost of living has started to rise prompting the European Central Bank to revise upwards its interest rates for the euro area. The ECB last week increased its basic interest rates to 1.5 per cent.

As inflation is predicted to continue to rise, further increases of interest rates by the end of this year are probable.