On August 1 (local time), Eurostat, the statistical office of the European Union, announced that the consumer price index in the Eurozone (the 20 countries using the euro) for July rose by 2.0% compared to the same period last year, according to preliminary data.
For the second consecutive month, the inflation rate has remained at 2.0%, which is the European Central Bank (ECB)'s medium-term inflation target. The core inflation rate, which indicates the underlying trend of prices, also remained stable at 2.3% for the third consecutive month.
By category, the price increase for food, alcohol, and tobacco was 3.3%, up 0.2 percentage points from 3.1% in June. The price increase for industrial goods was 0.8%, up 0.3 percentage points. In contrast, the inflation rate for services slowed from 3.3% in June to 3.1% in July. Energy prices fell by 2.5%.
Bloomberg and other foreign media outlets assessed that, as inflation in the Eurozone stabilizes, expectations are growing that the ECB will maintain its policy rate freeze. Previously, after seven consecutive rate cuts, the ECB kept its key interest rate unchanged at 2.0% on July 25.
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