EUR/USD Remains Little Changed After Eurozone Inflation Jumps to 2%
Eurozone inflation jumped to 2% in May, but headline CPI remains weak
The Eurozone economy has suffered most due to the coronavirus, having experienced two recession – one in spring last year and one last winter. Inflation turned negative for several months from August until December, but started picking up again as the oil prices kept climbing higher.
However, the European Central Bank has been trying to play inflation down as transitional, and pledging to keep the stimulus programs running until the end. But today, we saw another increase in inflation, with the headline CPI (consumer price index) jumping to 2% and the core CPI came in at 0.9%.
Latest data released by Eurostat – June 1, 2021
- May preliminary CPI YoY +2.0% vs +1.9% expected
- May CPI was +1.6%
- Core CPI YoY +0.9% vs +0.9% expected
- May core CPI was +0.7%
The headline reading is the highest since November 2018, as it reaffirms stronger inflation pressures, which could partly be due to base effects and also higher input cost inflation across the region/globe. Core inflation is in line with estimates, remaining just under 1%, so that is unlikely to raise too many eyebrows at the ECB just yet, but it will be interesting to watch for the trend in the months ahead.
Latest data released by Eurostat – June 1, 2021
- April unemployment rate 8.0% vs 8.1% expected
- March unemployment rate was 8.1%
A slight downward tick in the jobless rate, but considering the furlough programs in the region, it is tough to draw too many conclusions from the reading above.
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