© Reuters. FILE PHOTO: Workers assemble campers at Knaus-Tabbert AG factory in Jandelsbrunn
BRUSSELS (Reuters) – Euro zone producer prices increased at an accelerated year-on-year pace in February due to surges for energy and intermediate goods, data showed on Thursday, underlining expectations of faster consumer price growth in the coming months.
The European Union’s statistics office Eurostat said prices at factory gates in the 19 countries sharing the euro rose 0.5% month-on-month for a 1.5% year-on-year rise.
Changes in prices at factory gates are usually transmitted to final consumers and therefore herald trends in inflation that the European Central Bank targets with its monetary policy.
Euro zone consumer inflation jumped in March to 1.3%, taking another step higher in what is likely to be a temporary but sharp climb that may put consumer price growth above the European Central Bank’s target of near 2% later this year.
The ECB has predicted the surge, warning that inflation may even exceed its target by the close of the year, but has promised to look past what it expects to be a temporary spike in its policy decisions.
The main change in producer prices in February came from a jump in energy costs, which were up 2.3% year-on-year after months of year-on-year declines. But even excluding energy, producer prices rose 1.2% in February after a 0.7% in January.
Prices of intermediate goods rose 2.4% year-on-year in February after a 1.0% rise in January while prices of non-durable consumer goods continued to decline.
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