BRUSSELS, May 4 (Reuters) - Euro zone producer prices
fell a bit more than expected month-on-month in March, data
showed on Thursday, pointing to a further slowdown in consumer
prices as the European Central Bank is expected to announce yet
another interest rate rise.
The European Union's statistics office Eurostat said prices
at factory gates in the 20 countries sharing the euro fell 1.6%
in March against February and grew 5.9% year-on-year,
decelerating sharply form 13.3% annual growth in February.
Economists polled by Reuters had expected a monthly fall of
1.7% and a 5.9% year-on-year rise.
Producer prices are an early indication of trends in
consumer inflation, which the ECB wants to keep at 2.0% over the
medium term, but which still stood at 7.0% in April. The ECB has
been raising rates since the middle of 2022.
The bank is set to announce another interest rate rise later
on Thursday, increasing borrowing costs to 3.75 or even 4.0% to
fight the persistently high inflation. Eurostat said the monthly fall in producer prices was mainly
thanks to a 4.8% drop in energy costs and a 0.4% easing in
prices of intermediate goods.
Falling energy prices were also keeping the year-on-year
reading down, because without energy, producer prices were 8.0%
higher than a year earlier, mainly because of a 13.4% increase
in non-durable consumer products, such as food. Durable consumer
products, however, were also boosting the overall index, rising
8.2% year-on-year in March.
(Reporting by Jan Strupczewski)
Messaging: jan.strupczewski.reuters.com@reuters.net))
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.