Eurozone inflation yet to peak on higher energy, food prices – ICIS economist

MADRID (ICIS)–Inflation in the eurozone has yet to peak as energy and food prices are expected to go even higher in coming months, an ICIS economist said.

Kevin Swift, senior economist for global chemicals at ICIS, said the 19-country currency union’s June inflation rate was 8.6%, up from 8.1% in May.

He added that a “silver lining” was an easing in the rate of inflation in the services sectors, which eased slightly year on year.

However, any positive is likely to continue being eroded by rising energy and food prices, said Swift.

“Given recent restrictions on natural gas deliveries, [energy prices] will likely get worse. Food prices accelerated to an 8.9% year-on-year pace in June, up from 7.5% year-on-year [in May],” said Swift.

“Given disruptions in food supply, these gains will likely be elevated in the months to come.”

Eurozone inflation has caught up to the US rate of inflation and it is likely it has not yet reached a peak, said Swift.