Year-on-year inflation in the euro area hit a new high in July, reaching a 8.9%while GDP in the second quarter of the year grew by 0.7%, with Spain in the lead among the countries that share the single currency, as reported this Friday by the EU statistical office, Eurostat.

According to preliminary data from Eurostat, year-on-year inflation in the euro area increased by three tenths in July compared to June and stood at 8.9%.

For components, energy was the main factor increase in prices, although the annual rate fell to 39.7% in July after reaching 42% in June.

After the energy they remained standing food, alcohol and tobaccowhich went from 8.9% in June to 9.8% in July, while non-energy industrial goods went from 4.3% to 4.5%.

The year-over-year rate in Services it grew by three tenths compared to June and stood at 3.7% in July.

Year-on-year inflation in the euro area was 5.9% in February and 7.4% in March and April, while it reached 8.1% in May and 8.6% in June.

Core inflation, which excludes energy and fresh food due to higher price volatility, reached 5% in July, four tenths higher than in June.

By country, the Baltic republics saw the largest price increase, with Estonia in the lead (22.7%)followed by Latvia (21%) and Lithuania (20.8%).

The group of countries with double-digit inflation is completed by Slovakia (12.8%), Slovenia (11.7%), the Netherlands (11.6%), Greece (11.5%), Spain (10.8%, the highest level in 38 years), Cyprus (10.6%) and Belgium (10.4

Below the eurozone average are Germany (8.5%), Italy (8.4%), Finland (7.9%), France (6.8%) and Malta (6.5%).

In its latest economic forecasts, published this month, the European Commission (EC) anticipated that inflation in the euro area will close this year with an average of 7.6%, and then drop to 4% in 2023.

GDP advances

Eurostat also released this Friday the preliminary quick estimate of GDP, which increased by 0.7% in the eurozone and by 0.6% in the European Union (EU) in the second quarter of the year compared to the first.

“Good news! The economy of the euro zoneor exceeds expectations in the second quarter. Uncertainty remains high for the next quarters: it is necessary to maintain unity and be ready to respond if necessary to an evolving situation “, the European Commissioner for the Economy, Paolo Gentiloni, reacted on Twitter.

He pointed this out Italy and Spain, “in particular”, have achieved good results.

“we are not in a recessionbut uncertainty remains for the next few months and inflation remains at record levels, “he said.

In the first quarter of 2022, GDP increased by 0.5% in the euro area and by 0.6% in the Union as a whole.

Compared to the second quarter of last year, the economy grew by 4% both in the single currency area and in the EU27.

With an economic growth of 1.1% between April and June compared to the first three months of 2022Spain was the euro area country that made the most progress of GDP among the partners for which Eurostat has published data.

In the entire European Union it was overtaken by Sweden, whose GDP grew by 1.4%.

After Sweden and Spain came Italy (1%), while the economy suffered setbacks in Latvia (1.4% less), Lithuania (0.4%) and Portugal (0.2%) .

Among the major economies of the eurozoneGermany remained stablewhile France advanced by 0.5%.

Growth rates compared to the same period of the previous year they tested positive for all countriesthe statistical office specified.

In its summer forecast, the EC predicts that the EU economy will grow by 2.7% in 2022 and 1.5% in 2023, while growth in the euro area is expected to stand at 2.6% in the year. 2022 and moderate at 1.4% in 2023.

“As the reality of the protracted Russian invasion of Ukraine takes effect, the analysis of its economic consequences for the global economy becomes darker,” Brussels summarizes in a report.

There he admitted it the war is “hitting” the European economy both directly and indirectly to place it “on a path of lower growth and higher inflation”.

EFE

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