The Eurostat published yesterday that the Euro Area inflation rate grew by 2.8% (Y-2-Y) during April 2011.
This is a moderate increase from March’s inflation rate of 2.7%.
The EU inflation rate during April reached 3.2%, an increase from 3.1% during March.
Among the Euro Area countries with the highest inflation rates were Estonia (5.4%), Portugal (4%), and Greece (3.7%).
The lowest inflation rates were recorded in Ireland (-0.4%), Latvia (1.3%) and Netherlands (1.4%).
Among the major components that contributed to the rising CPI was Energy (12.5%) and Transport (5.9%) which inclined due to the high gasoline prices.
The news from this report doesn’t seem to catch traders by surprise as the EURO/USD moderately inclined by 0.26%.
Since the rising inflation in EURO AREA is stem mainly due to the high oil prices, i.e. an exogenous factor, then the recent news about the inflation might not cause the ECB to raise interest rates in the next ECB rate decision.
For further reading (in this site):
- Weekly outlook for May 16-20
- Euro Area GDP grew by only 0.8% in 1st quarter 2011
- The EURO/USD drops as ECB left interest rate unchanged