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Euro zone inflation steady in May

Euro zone - Inflation in line
Euro zone - Inflation in line

Inflation in the 13 countries sharing the euro held steady in May at 1.9%, according to a  first estimate from the European Union's Eurostat data agency.

The rate, which Eurostat is due to update with more complete data on June 14, met economists' expectations to remain unchanged for the third month running in May at 1.9% on an annual basis.

The rate remains in line with the European Central Bank's preference for an annual inflation rate of less than but close to 2% to maintain price stability.

With economic activity in the euro zone brisk, the ECB is keen to keep inflation pressures firmly under control and has sent clear signals that it will raise its key interest rates in June.

Separate figures from the European Commission showed that economic optimism rose  more quickly than expected in May despite the prospect of increased interest rates and the euro's strength.

The European Commission's euro zone economic sentiment indicator increased in May to 111.9 points from 111 in April, beating economists' forecasts for a steady 111.

The survey highlighted a strong improvement in overall economic confidence in the biggest EU economies, particularly in Britain, followed by France and Germany.

But a separate euro zone business climate indicator from the European Commission fell in May to 1.53 points from 1.61 in April,  although it remained at a high level.