EU inflation hits two per cent

EU inflation hits two per cent

Annual inflation in April 2010 in the European Union was two per cent, up from 1.9 per cent the previous month, and from 1.3 per cent a year earlier, EU statistics office Eurostat said on May 18 2010. April 2010 euro area annual inflation was 1.5 per cent in April 2010, up from 1.4 per cent in March. A year earlier the rate was 0.6 per cent. Monthly inflation was 0.5 per cent in April 2010, Eurostat said. EU monthly inflation was 0.4 per cent in April 2010. Among EU member states, in April 2010 the lowest annual rates were in Latvia (-2.8 per cent), Ireland (-2.5 per cent) and Lithuania (0.2 per cent), and the highest in Hungary (5.7 per cent), Greece (4.7 per cent) and Romania (4.2 per cent). Compared with March 2010, annual inflation fell in six EU member states, remained stable in three and rose in 17. The lowest 12-month averages up to April 2010 were in Ireland (-2.5 per cent), Portugal (-0.7 per cent), Estonia and Latvia (both -0.6 per cent), and the highest in Hungary (five per cent), Romania (4.9 per cent) and Poland (3.8 per cent). In the euro zone, the main components with the highest annual rates in April 2010 were transport (5.9 per cent) and alcohol and tobacco (4.2 per cent) while the lowest annual rates were observed for recreation and culture (-one per cent), communications (-0.6 per cent) and food (-0.2 per cent). Concerning the detailed sub-indices, according to Eurostat, fuels for transport (+0.75 percentage points), heating oil (+0.21) and tobacco (+0.11) had the largest upward impacts on the headline rate, while gas (-0.14) and package holidays (-0.11) had the biggest downward impacts. The main components with the highest monthly rates were clothing (3.2 per cent), transport (0.8 per cent) and housing (0.6 per cent), while the lowest were recreation and culture (-1.1 per cent), communications (-0.2 per cent) and education (-0.1 per cent). In particular, garments (+0.14 percentage points) and fuels for transport (+0.10) had the largest upward impacts, while package holidays (-0.11) had the biggest downward impact. Eurostat also released trade balance figures on May 18. The first estimate for the euro zone trade balance with the rest of the world in March 2010 gave a 4.5 billion euro surplus, compared with +1.6 billion euro in March 2009. The February 2010 balance was +2.4 billion euro, compared with -1.2 billion euro in February 2009. In March 2010 compared with February 2010, seasonally adjusted exports rose by 7.5 per cent and imports by 10.3 per cent. The first estimate for the March 2010 extra-EU27 trade balance was a 7.1 billion euro deficit, compared with -9.2 billion euro in March 2009. In February 2010, the balance was -6.5 billion euro, compared with -10.8 billion euro in February 2009. In March 2010 compared with February 2010, seasonally adjusted exports rose by seven per cent and imports by 10.4 per cent. The EU27 deficit rose for energy (-43.1 billion euro in January-February 2010 compared with -38.9 billion euro in January-February 2009), while the surplus for manufactured goods has increased (+18.0 billion euro compared with +7.9 billion euro). EU27 exports to its major partners grew in January-February 2010 compared with January-February 2009, except for the United States and Russia (both down by one per cent). The most notable increases were recorded for exports to China (47 per cent), Turkey (37 per cent) and India (36 per cent). For imports, the largest increases were recorded with Russia (30 per cent), India (14 per cent) and Turkey (12 per cent), and the largest falls with the US (-14 per cent), Japan and Brazil (both -five per cent). The EU27 trade surplus increased with the US (7.9 billion euro in January-February 2010 compared with 4.4 billion euro in January-February 2009). The EU27 trade deficit decreased with China (-22.6 billion euro compared with -28 billion euro) and Japan (-2.7 billion euro compared with -3.7 billion euro), but increased with Russia (-12.6 billion euro compared with -7.3 billion euro). Concerning the total trade of EU member states, the largest surplus was in Germany (20.6 billion euro in January-February 2010), followed by the Netherlands (6.7 billion euro) and Ireland (6.2 billion euro).

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