German inflation rises with energy costs as US-Iran war drags on
German inflation accelerated again in August as the Iran war stoked energy costs, official data showed Monday, fuelling expectations the European Central Bank would raise interest rates next month.
German inflation accelerated again in August as the Iran war stoked energy costs, official data showed Monday, fuelling expectations the European Central Bank would raise interest rates next month.
Consumer prices in Europe's biggest economy rose 2.9 percent from a year earlier, according to preliminary figures from statistics agency Destatis, up from 2.8 percent in July.
The main driver was energy costs that rose 10.5 percent overall. Food and services inflation eased slightly.
The US war against Iran and the near-total closure of the Strait of Hormuz, a key energy trade route, has sent global energy costs soaring.
The ECB is expected to resume raising interesting rates at its meeting on September 10th after a pause in July to tame the surge in prices.
Inflation across the 21-nation eurozone stood at 2.9 percent in July, above the ECB's two-percent target.
"With oil prices remaining elevated and the risk of a fresh gas price shock increasing, most ECB policymakers are likely to see the case for another rate hike," said ING economist Carsten Brzeski.
The eurozone economy had also shown "an almost unexpected resilience to the war in the Middle East", he added.
