Eurozone inflation saw an uptick in May, driven predominantly by rising service costs, according to preliminary data released by Eurostat on Friday.
The Harmonized Index of Consumer Prices (HICP) rose by a greater-than-anticipated 2.6% on an annual basis, outpacing April’s 2.4% increase. The market had projected annual inflation to reach 2.5%.
Core inflation, which excludes volatile items such as energy, food, alcohol, and tobacco, unexpectedly accelerated to 2.9%, against forecasts that it would hold steady at 2.7%.
Breaking down the HICP components, the growth in prices for food, alcohol, and tobacco eased slightly to 2.6% from 2.8%. Energy prices saw a modest gain of 0.3%, recovering from a 0.6% decline in the previous month.
On the other hand, the annual increase in prices for non-energy industrial goods decelerated marginally to 0.8% from 0.9%, while service costs climbed at a quicker pace of 4.1%, following a 3.7% rise.
Month over month, the HICP edged up 0.2% in May. Final data is scheduled for release on June 18.
