Euro zone inflation revised to 1.3%, but remains weak for the ECB

BRUSSELS (Reuters) – Consumer prices in the eurozone rose slightly more than initially expected in June, according to data released on Wednesday, although sub-prime inflation rates and underlying investment remain below the improvement sought by decision-makers.

According to the EU Statistical Agency, Eurostat, prices in the 19 euro area countries increased by 1.3% in June, compared with a rapid estimate of 1.2%. In May, inflation was 1.2%, the lowest since April 2018.

Over the month, prices were up 0.2%, a little more than the market forecast of 0.1%, according to Eurostat data released on Wednesday.

The European Central Bank (ECB), whose monetary policy committee is meeting next week, is aiming for a rate close to 2% but lower than this one.

Benoît Coeure, a member of the ECB's governing board, said on Wednesday that the bank was ready to intervene if necessary to help inflation achieve this goal. At its meeting last month, the ECB postponed any rate hike for at least a year.

Eurostat said that the main measure of inflation taken into account by the ECB in political decisions, which excludes the volatile components of food and energy, was 1.3% in June, after 1.0% in May. He had previously estimated the June rate at 1.2%.

A narrower indicator, which also excludes alcohol and tobacco prices, rose from 0.8 in May to 1.1% in June, confirming earlier estimates.

The revisions follow a slight rise in energy prices – from 1.7% to 1.6% – and non-energy industrial products – from 0.2% to 0.2%. Inflation of unprocessed food products was reduced to 0.7% from the initial estimate of 0.8%

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