Eurozone Inflation Reaches 9.1 Percent, Driven by Prices for Energy and Food

Shopper costs in Europe continued their regular upward march in August, pushed by hovering meals and gas costs and shortages attributable to clogged provide chains.

Within the 19 international locations that use the euro as foreign money, the annual inflation charge jumped to a recent report of 9.1 %, up from 8.9 % in July, in accordance with estimates launched Wednesday by the European Fee’s statistical workplace. A 12 months earlier, inflation was 3 % — a charge that on the time marked a 10-year excessive and set off alarms, however would now be greeted with huge aid.

Hardest hit was Estonia, with inflation that surged above 25 %, with Lithuania and Latvia not far behind. France was among the many few international locations that noticed its worth index dip, to six.5 % in August, from 6.8 % within the earlier month. 9 international locations registered double-digit annual inflation in August.

The report, which comes every week earlier than the European Central Financial institution is scheduled to satisfy, will possible serve to bolster the view that rates of interest must be raised once more to curb inflation, regardless of the danger of recession.

Talking at an financial summit in Jackson, Wyo., over the weekend, Isabel Schnabel, a member of the financial institution’s govt board, warned that inflation was extra persistent than anticipated and stated the financial institution wanted to behave “forcefully.”

Claus Vistesen, the chief eurozone economist at Pantheon Macroeconomics, stated the feedback have been proof that inflation is the central financial institution’s main concern in the intervening time, “regardless of growing proof of slowing financial development.”

Vitality costs had the most important impression in pushing up costs, rising by an annual charge of 38.3 % in August. Meals, alcohol and tobacco costs rose by an annual charge of greater than 10 %.