Eurozone inflation turns negative in August on energy, industrial goods

Author: Jonathan Lopez

2020/09/17

LONDON (ICIS)--Inflation in the eurozone was at -0.2% in August, down from 0.4% in July, following a fall in energy and industrial goods prices, the EU’s statistical office Eurostat said on Thursday.

Except for France, inflation in all the other major economies in the 19-country currency union was in the negative.

In addition to eurozone recession concerns, core inflation – which excludes volatile energy prices – also fell in August.

The European Central Bank (ECB)’s target for inflation is to keep it close to, but below, 2%.

A negative inflation rate may reinforce suggestions that the central bank will need more economic stimulus later in the year to prop up prices.

In August 2019, inflation in the eurozone stood at 1.0%.

The inflation rate in the EU was 0.4% in August, down from 0.9% in July.

In August 2019, inflation in the 27-country bloc was 1.4%.

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The UK's inflation also fell sharply in August, the Office for National Statistics (ONS) said this week, but it remained at a positive 0.2%.