Eurozone Inflation Eases As Estimated

(RTTNews) - Eurozone inflation slowed to a 15-month low in May due to the fall in energy prices, final data from Eurostat confirmed on Friday.

The harmonized index of consumer prices increased 6.1 percent year-on-year in May, weaker than the 7.0 percent rise in April. This was the lowest rate since February 2022, when inflation was 5.9 percent. Core inflation that excludes energy, food, alcohol and tobacco prices, fell to 5.3 percent in May from 5.6 percent in the previous month. The core rate also matched the estimate published on June 1.

On Thursday, the European Central Bank had raised its three key interest rates by a quarter basis points as policymakers assessed that despite some slowing, inflation is likely to remain "too high for too long".

The HICP remained flat in May from April, data showed today.

The annual increase in prices was largely driven by the 12.5 percent rise in food, alcohol and tobacco prices. Moreover, non-energy industrial goods prices gained 5.8 percent and services cost moved up 5.0 percent. Meanwhile, energy prices were down 1.8 percent. Another report from Eurostat showed that hourly labor cost growth slowed in the first quarter.

Hourly labor cost posted an annual increase of 5.0 percent, slower than the 5.6 percent rise in the fourth quarter. However, the rate was better than economists' forecast of 3.3 percent.

Wages and salaries and non-wage costs are the two major components of labor cost. Wages and salaries per hour worked climbed 4.6 percent and the non-wage component grew 6.2 percent in the first quarter.