Investing.com – Consumer price inflation (CPI) in the euro zone increased more than expected in April, official preliminary data showed on Thursday.
In a report, Eurostat said consumer price inflation rose by a seasonally adjusted 1.9% in April, above expectations for an increase of 1.8% and following a final reading of a 2.0% advance in the prior month.
According to Eurostat, energy is expected to have the highest annual rate in April (7.5%, compared with 7.4% in March), followed by services (1.8%, compared with 1.0% in March), food, alcohol & tobacco (1.5%, compared with 1.8% in March) and non-energy industrial goods (0.3%, stable compared with March).
Core CPI, which excludes food, energy, alcohol, and tobacco costs, increased by a seasonally adjusted 1.2% in April from the same period a year ago, after a 0.7% gain in the prior month. Analysts had expected core inflation to increase by 1.0%.
After the European Central Bank (ECB) kept monetary policy unchanged on Thursday, ECB president Mario Draghi predicted that inflation would rise in April and that it will then “hover around current levels until the end of this year.”
The ECB’s inflation target is officially close to, but below, 2.0%.
Draghi also indicated that “measures of underlying inflation remain low and are expected to rise only gradually over the medium term.”
The ECB will not hold its next monetary policy meeting until June 8.
After the report, EUR/USD was at 1.0935 compared to 1.0896 ahead of the release, while EUR/GBP traded at 0.8446 compared to 0.8421 earlier.
Meanwhile, European stock markets were trading mixed. The Euro Stoxx 50 rose 0.14%, Germany's DAX edged forward 0.04%, France’s CAC 40 gained 0.11%, while London’s FTSE 100 traded down 0.24%.