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Europe’s Inflation Rate Rose To 7% In April

Inflation across Europe unexpectedly rose to 7% in April from 6.9% a month earlier as rising energy costs offset a decline in food prices.

Eurostat reports that inflation accelerated in April among the 20 nations that share the Euro currency.

Service inflation, which is driven by higher labour costs, accelerated to 5.2% in April from 5.1% in March as unions across Europe negotiate new labour agreements for workers.

Excluding volatile food and energy prices, core inflation slowed to 7.3% from 7.5% in March.

A narrower gauge of inflation that also excludes alcohol and tobacco prices slowed to 5.6% in April from 5.7% in March, marking its first decline since June 2022.

Inflation has been above the European Central Bank's 2% target for nearly two years and interest rates have been raised by 375 basis points since last July to lower consumer prices.

The European Central Bank is scheduled to meet next on June 15 and has already telegraphed that another interest rate hike is coming.