June flash: +2.7% y/y
MNI survey median: +2.8% y/y
MNI survey range: +2.7% to +2.9% y/y
May: +2.7% y/y
—
FRANKFURT (MNI) – Consumer price inflation in the Eurozone was
steady at an annual rate of 2.7% in June, Eurostat reported on Thursday,
citing preliminary estimates.
The majority of analysts polled had expected a mild acceleration in
the headline rate, though a significant proportion foresaw no change.
June’s annual rate suggests that prices decreased marginally on the
month.
Although a detailed breakdown will not be made available until July
14, consumer price data from a number of German states highlighted the
downward pressure from cheaper energy, which cut as much as 0.9
percentage point from the headline rate.
Recent PMI polls show a sharp slowdown in input price inflation,
“largely reflecting lower oil and other commodity prices,” the report
said. While output price inflation rose slightly in June, “lower costs
should feed through to lower selling prices, and ultimately consumer
price inflation, in coming months,” the report argued.
Supporting this assessment, selling price expectations declined
across all major business sectors in June to five- and six-month lows,
according to the European Commission’s survey. Consumers also revised
down their outlook for price trends over the coming year to the lowest
level since January.
The Commission expects consumer price inflation to average +2.6%
this year and slow to +1.8% in 2012.
In line with the Commission’s forecasts, the most recent European
Central Bank staff projections foresee inflation between 2.5% and 2.7%
this year and between 1.1% and 2.3% in 2012.
— Frankfurt bureau, +49-69-720 142; email: frankfurt@marketnews.com —
[TOPICS: M$X$$$,MT$$$$,M$XDS$]
