In August, Eurozone’s CPI defied market expectations by remaining unchanged at a 5.3% yoy, contrary to anticipated slowdown to 5.1% yoy. Core inflation, which excludes energy, food, alcohol, and tobacco, did slow down, but only to match expectations, declining from 5.5% yoy to 5.3% yoy.
A breakdown of the main components contributing to Eurozone’s inflation rate reveals a mixed bag. Food, alcohol, and tobacco are expected to register the highest annual rate in August at 9.8%, albeit lower than the 10.8% seen in July. Services come next, slipping slightly from 5.6% to 5.5%, followed by non-energy industrial goods which also dipped from 5.0% to 4.8%. Notably, energy costs seem to have eased their downward trend, registering at -3.3% compared to -6.1% in the previous month.
