September 26, 2020

Inflation in the euro zone rebounds to 0.4% in July and widens the price differential favorable to Spain


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The annual inflation rate of the euro zone in July stood at 0.4%, one tenth above the figure for June, as a result of the lower drop in energy prices and the moderation in the cost of services, according to preliminary data published by Eurostat.

In the European Union as a whole, the annual inflation rate reached 0.9% in July, one tenth above the previous month’s reading.

In the case of Spain, prices fell 0.7% in July, accelerating the fall of 0.3% observed the previous month, which widens the price differential favorable to the Spanish economy compared to 1.1 percentage points. with its euro partners.

According to Eurostat, in the month of July energy prices fell by 8.4%, compared to the 9.3% decrease in the previous month, while fresh food has become 3.1% more expensive instead of 6% in June. For its part, the price of services has risen 0.9%, three tenths less than in June.

Thus, when excluding the effect of energy, the annual inflation rate in the euro zone stood at 1.4%, one tenth above the reading of the previous month, while leaving out food as well fresh, tobacco and alcohol, the eurozone’s core inflation rate has risen to 1.2% in July from 0.8% in June.

Among the countries for which data were available, the biggest price falls were in Greece (-2.1%), Cyprus (-2%) and Estonia (-1.3%), while the most pronounced increases corresponded to Hungary (+ 3.9%), Poland (+ 3.7%) and Czechia (+ 3.6%).

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