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Europe inflation at 2.4%
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August 18, 2000: 7:52 a.m. ET
Price rises again top ECB target; core rate hits 1.4%
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LONDON (CNNfn) - Euro-zone annual inflation remained at 2.4 percent in July, official data showed Friday, in line with economist's forecasts but still above the European Central Bank's 2 percent ceiling.
The report reinforces speculation the ECB could raise rates at its next meeting on August 31st.
The inflation rate for the 11-nation zone united under the common currency was the same as in June but was up from the 1.1 percent rate a year earlier, statistical agency Eurostat reported.
Many economists have said that a weak euro and rising crude oil prices - which rose to a new 10-year high in London this week - have been behind the upward spiral in prices.
While the numbers were in line with projections, one economist said the greater surprise was the increase in "core" inflation, which excludes volatile energy prices, to 1.4 percent in July from 1.2 percent in June.
"The headline rate was really spot on," said Jeremy Hawkins, a euro-zone economist with Bank of America. "But while the ex-energy index is still soft, it's up from 1 percent in May. That may indicate that general cost pressures are beginning to feed through the economy."
"You can ignore oil prices, perhaps, but over time they're going to have a secondary effect," he added. "The problem has been that the euro is weak, and at the same time dollar-denominated oil prices have been rising, meaning there has been a double negative effect."
By country, the highest annual inflation rate was in Ireland, one of the euro-zone's fastest-growing economies, where prices rose 5.9 percent. Inflation was 4.7 percent in Luxembourg and 3.7 percent in Spain, while the lowest rates were in Germany, France and Austria, at 2 percent each.
The euro was little changed after the release of the data, trading at 91.34 U.S. cents compared to 91.69 in late New York trading on Thursday. 
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Eurostat
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