BRUSSELS (Reuters) – Euro zone producer prices rose faster than expected in September, mainly because of more expensive energy, data showed on Tuesday.
The European Union’s statistics office Eurostat said prices at factory gates in the 19 countries sharing the euro rose 0.5 percent month-on-month in September for a 4.5 percent year-on-year rise.
Economists polled by Reuters had expected a 0.4 percent monthly gain and a 4.2 percent annual increase.
Eurostat also revised upwards producer price growth in August to 0.4 percent on the month and 4.3 percent year-on-year from 0.3 and 4.2 percent, respectively.
The stronger price growth was mainly a result of a 1.6 percent monthly and a 12.7 percent annual jump in energy costs. Excluding the volatile energy component, producer prices edged up only 0.1 percent on the month and 1.5 percent year-on-year.
Producer prices signal inflationary pressures early in the pipeline because, unless absorbed by retailers and intermediaries, the price increases are passed on to consumers, fuelling consumer inflation that the European Central Bank wants to keep below, but close to 2 percent over the medium-term.
(Reporting by Jan Strupczewski, Editing by Gabriela Baczynska)