Preliminary data shows that inflation across the European Union (EU) declined to 5.3% in July from 5.5% in June of this year.
Core inflation that excludes volatile food and energy prices remained unchanged at 5.5% in July.
The European Central Bank targets inflation at a 2% annualized rate. Last week, the central bank lifted its key interest rate by 25-basis points to 3.75%.
In recent months, food prices have contributed the most to inflationary pressures across Europe. In July, food, alcohol, and tobacco prices rose by 10.8% from a year ago.
At the same time that the latest inflation data was released, new economic statistics showed that Gross Domestic Product (GDP) in Europe expanded by 0.3% in this year’s second quarter.
The Q2 GDP growth of 0.3% was better than the 0.2% expected by economists surveyed by the Reuters News Agency.
The economies of France and Ireland were particularly strong in Q2, with France posting a GDP growth rate of 0.5%, while Ireland’s economy expanded by 3.3%.
Spain’s economy grew by 0.4% in Q2, while Germany’s economy failed to post any growth.
The Q2 GDP growth figure means that Europe has avoided an economic recession for the time being, though some economists still forecast a recession heading into 2024.