Euro zone inflation rises above 3%, cementing ECB rate hike bets
Energy inflation jumped to 14.3% and markets now fully price in a quarter-point European Central Bank rate hike next week.
- On Tuesday, Eurostat reported that inflation across the 21 nations sharing the euro accelerated to 3.3% in August from 2.9% in July, driven primarily by rising energy costs.
- The Iran war and the blockage of the Strait of Hormuz continue to disrupt energy markets, driving energy inflation to 14.3% from 10.3% while pressuring crude oil and natural gas prices.
- Core inflation, which excludes volatile food and fuel prices, dipped to 2.4% last month from 2.5% as growth in services prices slowed to 3% from 3.3%.
- Traders locked in expectations for a European Central Bank rate hike to 2.50% on Sept. 10, with market pricing on Tuesday morning putting a 98.9% probability on the increase.
- For SMEs, further financing costs could mean investment plans being "indefinitely postponed or abandoned altogether," analysts warn, even as policymakers hold rates at a 'neutral' level.
228 Articles
228 Articles
Euro area inflation jumped to 3.3 percent in August. On September 10, the ECB decides on interest rates – for savers, this has two sides.
Euro inflation is now 3.3 percent. This is mainly due to expensive crude oil as a result of the Iran war - a dilemma for Europe's central bankers. Are prices likely to rise even faster soon? By Angela Göpfert.
Eurozone inflation surge strengthens case for ECB September rate hike
Euro zone inflation rose back above 3 per cent in August on higher energy costs, cementing an already solid case for another European Central Bank interest rate hike this month as the Iran war keeps putting upward pressure on prices. Inflation in the 21 nations sharing the euro accelerated to 3.3 per cent in August […]
Inflation in the euro area has never been so high since 2023. It rises to 3.3% in one year in August, after reaching 2.9% in July. This increase in inflation concerns the 21 countries sharing the single European currency. France ranks among the best pupils with inflation at 2.7%.
The main inflationary vector was energy, with a price increase of 14.3% year-on-year in August
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