- Howard Archer, IHS Economics
Consumer inflation in the Euro zone barely climbed from the previous year in July, while the number of unemployed rose in June, adding to signs that the ECB's QE programme has yet to deliver the desired results. According to Eurostat, consumer prices in the region were 0.2% higher than in July 2013, considerably below the central bank's goal of just under 2%. Inflation was subdued by a renewed decline in energy prices, which dropped 5.6% from a year earlier. Nevertheless, there were signs that the prices of other goods and services have begun to tick up. Excluding prices for volatile energy, food and alcohol, the core annual rate climbed to 1.0% from 0.8%.
A separate report showed the number of people without jobs in the Euro bloc increased in June by 31,000, while the jobless rate remained intact at 11.1%, maintaining its lowest level in three years. The number of unemployed in Germany surprisingly rose by 9,000 in July, whereas the unemployment rate remained unchanged at its record low of 6.4%. The reading came in much worse than analysts' predictions for a 5,000 decline. The unemployment rate in Italy, the third largest economy in the Euro bloc, also worsened. The number of registered unemployed in June made up 12.7% of the economically active population. Yet, Greece remains a record-holder, with the jobless rate at 25.6%.
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