Euro zone inflation was higher than expected in May, data showed today, as consumer prices started rising again after five months of falls and stagnation despite a continued strong drag on the index from cheaper energy.
The European Union's statistics office Eurostat said consumer prices in the 19 countries sharing the euro rose 0.3% year-on-year last month.
This came after a flat reading in April and the figures were better than market expectations of a 0.2% increase.
The Eurostat estimate does not contain monthly data, but the annual data showed that more expensive unprocessed food and services had the biggest upward impact on the overall index.
Excluding the volatile energy prices, which were 5% lower in May than 12 months earlier, consumer prices rose 1%.
Excluding energy and unprocessed food - or what the European Central Bank calls core inflation - prices were up 0.9%, accelerating from 0.7% in April.
The inflation rebound could mean that the ECB's sovereign bond buying programme, aimed at injecting more cash into the economy to prevent deflation and started in March, has brought rapid results.
But prices at factory gates in April, however, fell 0.1% month-on-month for a 2.2% year-on-year decline, weaker than market expectations of a 0.1% monthly rise and a 2% annual fall.
Producer prices are an indication of inflationary pressure early in the pipeline, because unless their changes are absorbed by retailers via profit margins, they tend to translate into consumer prices.
