Inflation in the eurozone reaches 3.3% in August driven by energy costs

Prices continue their rise in the eurozone. The figure rose to 3.3% year-on-year in August, four tenths more than in the previous month and its highest level in more than three years, since September 2023. Spain is one of the countries that suffers the most, with a CPI of 4.5%. According to the figures presented today by Eurostat, prices are rising driven by energy, which has hit continental lands since the beginning of the conflict in the Middle East. The cost of energy skyrockets by 14.3%.

The rebound in gasoline prices due to fears over the closure of the Strait of Hormuz is the focus. Since March installed above the 2% level pursued by the European Central Bank (ECB), the rebound in August brings closer the increase in interest rates by the entity chaired by Christine Lagarde. Today with interest rates at 2.25%, the central bankers of the eurozone will meet on September 10. The market is pricing in a rise of another quarter point. This would seek to cool activity to contain prices, the main mandate of the entity.

Core inflation, which does not take into account fresh food or energy, also remains above desired. In August it stood at 2.4%, one tenth less, but still close to annual maximums. The positive note is in services, one of the metrics that is also looked at closely, which reduced its increase to 3%, three tenths less.

“Food inflation also remains stable for now, as price pressures have not yet been passed on to consumers,” Oxford Economics analysts warn. For example, the food, alcohol and tobacco group advances 1.2%, and in fresh products the rate is 2.7%, below the 4.6% seen in April. Food is expected to grow strongly next year, when the rise in fertilizers or the impact of heat waves hit the chain.

Spain remains in the group of countries with the highest inflation. In the national case, prices advance six tenths to 4.5% according to the harmonized Eurostat system. Only Lithuania (5.8%), Cyprus (5.2%) and Bulgaria (5.1%) surpass it. In the rest of the major drivers of the eurozone economy, they are all on the rise. France shows the most contained evolution (2.7%, three tenths more), Germany is somewhat higher (2.9%, one tenth more) and Italy registers 3.2% after rising three tenths.