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.
195 Articles
195 Articles
The annual inflation rate in the euro area has accelerated to 3.3% over the past August, at a time when investors are looking forward to the course of interest rates and ECB decisions.
Euro area inflation rises to 3.3% as Finland rate eases
Euro area inflation rose to 3.3% in August from 2.9% in July, according to a flash estimate published by Eurostat on Tuesday, driven by a rise in energy prices. Finland moved in the opposite direction, with annual inflation easing to 2.4% from 2.5% a month earlier. Energy prices in the euro area increased by 14.3% from a year earlier, compared with a 10.3% annual rise in July.
Consumer prices in the euro area rose by 3.3 percent in August. "The ECB is following inflation," says capital market analyst Robert Halver in conversation with Dietmar Deffner.
Inflation accelerated in the eurozone to 3.3% in August from 2.9% in July, driven by rising energy prices, boosting the European Central Bank's forecast to raise interest rates to 2.5% this month.
Annual inflation in the euro area is expected to increase to 3.3% in August 2026, from 2.9% in July, according to Eurostat's flash estimate. The European Statistical Office, Eurostat, in data released today, says. The main components of euro area inflation Looking at the main components of euro area inflation, energy is expected to have the highest annual rate in August (14.3%, compared to 10.3% in July), followed by services (3.0%, compared to …
Coverage Details
Bias Distribution
- 44% of the sources lean Right
Factuality
To view factuality data please Upgrade to Premium
