New figures show that the annual rate of inflation in the euro zone hit a new record of 3.5% in March.
The figure, from the EU's Eurostat agency, was well above the European Central Bank's target of just under 2%. It rose from 3.3% in February and was also slightly above economists' expectations of 3.4%.
ECB officials have repeatedly warned about high inflation recently, indicating that the bank is unlikely to cut interest rates any time soon.
Separate figures from the European Commission showed that confidence in the euro zone economy fell by more than expected in March, hitting the lowest level in nearly two and a half years.
The Commission's economic sentiment indicator for the euro zone fell to 99.6 points in March from 100.2 in February, hitting the lowest level since November 2005.
The Commission blamed the bleaker outlook on weaker confidence in the services and construction sector while consumer confidence held steady.
Despite the darker euro zone outlook, the commission said that its separate business climate indicator improved in March, rising to 0.80 points in March from 0.71 in February and halting a three-month decline.
