Euro Zone Inflation Declines To 6.9% In March - InvestingChannel

Euro Zone Inflation Declines To 6.9% In March

Inflation across the European Union fell sharply in March led by a decline in energy prices.

Headline inflation in the 20-member European zone came in at 6.9% in March, according to data from statistics agency Eurostat. That was down considerably from 8.5% in February.

The main contributor to the March decline was energy costs, with prices for gasoline and home heating oil falling during the month.

Higher food prices contributed the most to the overall inflation reading in Europe during March, said Eurostat.

However, while headline inflation fell, core inflation, which excludes volatile food and energy prices, rose slightly in March from February, hitting an all-time high of 5.7%.

The European Central Bank raised interest rates across the continent by 50-basis points earlier in March, bringing its benchmark rate to 3%.

The latest inflation reading is likely to prompt the central bank to continue raising interest rates as it tries to bring inflation back down to its 2% target, said economists.

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