Euro zone inflation hits record 4%
Monday, 30 June 2008 16:10Record inflation in the euro zone is a concern 'of the highest degree', the head of the Eurogroup of finance ministers, Jean-Claude Juncker, said today.
The European Union's Eurostat data agency estimated earlier that annual inflation in the bloc hit 4% in June, the highest rate since the launch of the euro in 1999.
'The recent inflation estimates are a concern of the highest degree,' Juncker said as he arrived at a conference in Luxembourg, where European Central Bank president Jean-Claude Trichet was also due to speak.
The June inflation figures boosted speculation that a widely expected ECB interest rate hike on Thursday may be followed by further increases as the central bank battles to get inflation under control.
'The ECB will meet Thursday and take appropriate decisions keeping in mind the risks to price stability and the possible impact on economic growth,' said Juncker, who is both Luxembourg's premier and finance minister.
The annual rate of inflation in the euro zone shot up to a record 4% in June, according to an initial EU estimate.
The June rate, up from 3.7% in May, was the highest since the launch of the euro back in 1999. It was slightly higher than the 3.9% economists had expected.
Soaring oil prices and rising food prices have been driving overall inflation to new records.
