The European Statistical Office (Eurostat) estimates that the annual inflation rate for June 2008 reached 4%. In May this rate had been 3.7%. If this estimate was to be confirmed, this would be the highest inflation rate since the monetary union was brought under way nine years ago. Furthermore, it could prompt the European Central Bank to raise key interest rates.
The European Central Bank (ECB) is going to decide on raising interest rates next Thursday. Opinions are devided on whether the ECB is going to attach more importance to the fact that such a measure would curb inflation or whether it will be avoided in order not to hamper cyclical economic development. However, the above estimate indicates that inflation in the EU must be stopped as soon as possible.
This inflation estimate is based on inflation figures by those member states which made them available to Eurostat as well as on information already available on the development of energy prices.