Euro zone consumer inflation sharply decelerated in May, the European Union’s statistics office confirmed today, with the core price growth measure, watched closely by the central bank, also slowing.
Eurostat confirmed its earlier estimates that consumer inflation in the 20 countries did not change at all month-on-month in May resulting in a 6.1% rise year-on-year, down from 7.0% year-on-year in April.
The contribution from energy prices, long the main driving force of inflation, was negative in May at 0.09 points and the main driver became the cost of food, alcohol and tobacco which added 2.54 points to the final figure.
The second biggest contributor was the rising prices of services, adding 2.15 points, with industrial goods adding another 1.51 points.
The European Central Bank wants to keep inflation at 2 percent over the medium term and has been raising interest rates quickly since the middle of last year to curb inflation.
The ECB raised interest rates again on Thursday to a 22-year high of 3.50% and said it would move again in July, continuing what has been the fastest pace of monetary tightening in the bank’s quarter century existence.