Frankfurt, June 30 (BNA): Inflation in Europe eased again in June but fell too slowly to offer much comfort to shoppers grumbling about price tags or to stem further rate hikes that will raise the cost of borrowing across the economy.
The European Union’s statistics agency Eurostat said on Friday that the annual rate of 5.5% was down from 6.1% in May in the 20 countries that use the euro.
While this is a significant drop from a peak of 10.6% in October, persistently high rates in the US, Europe and the UK have prompted some of the world’s top central bankers to make it clear that they will continue to raise interest rates and leave them there until the inflation rate falls to their target of 2% which is better for the economy.
Consumers in Europe saw relief in energy costs, which fell 5.6% after last year’s crisis, while food prices rose 11.7% from a year earlier, down from 12.5% in May.
Core inflation, which excludes volatile food and fuel costs and provides a clearer picture of long-term price pressures, rose slightly to 5.4% from 5.3% in the previous month.
Inflation varied widely across the Eurozone – with Slovakia recording the highest rate at 11.3%. Germany, Europe’s largest economy, recorded 6.8%, and France 5.3%.
Three countries came under the ECB’s 2% target: Luxembourg at 1%, Belgium at 1.6% and Spain at 1.6%.
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