Eurozone producer price growth accelerates further

EUROZONE industrial producer price growth accelerated in July, indicating a continued build-up in price pressures that will likely keep pushing consumer prices higher for months to come, Eurostat data showed on Friday (Sep 2).

Producer price growth in the 19 countries sharing the euro accelerated to 37.9 per cent in July from 36 per cent a month earlier, beating expectations for a 35.8 per cent rise, on a continued surge in energy costs.

On the month, prices rose by 4.0 per cent, following a 1.3 per cent increase in June.

Historically, producer price growth only loosely correlated with consumer inflation but the relationship between the 2 has become closer during the recent price surge and Friday’s figures are likely to foreshadow more pain for the bloc’s households.

Consumer inflation in the euro area accelerated to 9.1 per cent in August, Eurostat said earlier, and a peak is seen around 10 per cent close to the turn of the year.

Producer price growth was driven by a 97 per cent jump in energy sector costs but prices across industry excluding energy were still up 15.1 per cent

Durable goods prices rose 9.8 per cent while non-durable consumer goods were up 13.8 per cent. REUTERS