Annual Inflation up to 0.2% in the Euro Area and the EU

Eurostat has revealed that there was a marginal rise in inflation rates in the euro area in July, leaping up from 0.1% to 0.2% month on month, and that prices remained stable across the European Union (EU), which stayed on 0.2%.

Restaurants and cafes provided the main upward pressure on prices, as they leapt forward by 0.11%, followed by vegetables and fruit by 0.0.8% and 0.09% respectively, in comparison transport fuels declined by 0.46%, heating oil by 0.15%, and gas by 0.12%, which all forced downward strains on inflation.

Negative year on year inflation rates were recorded in twelve of the EU member states, where the lowest rates were found in Bulgaria and Croatia, which both dropped by 1.1%, and Slovakia 0.9%.

Whereas the highest annual rates were recorded in Belgium 2.0%, Sweden 1.1%, and Malta 0.9%, compared with June this year, annual inflation fell in nine Member States, remained stable in seven and rose in twelve.

The latest figures are considerably short of the 2% inflation target of the European Central Bank, who will still be hoping that their extended quantitative easing programme to 80 billion euros per month, and corporate bonds buying programme announced which was launched in  March, will eventually seep into the economy boosting demand, and the amount of money spent in euro area economies.

The EUR/USD rate has climbed in favour of the euro over the past 24 hours, but the initial market reaction to the inflation figures is a fall in the euro’s value, which is now buying $1.131, dropping from this morning’s CET peak of $1.333.

UK Retail Sector Confounds Brexit to Leap by 1.4%

UK shoppers appear to have shrugged off any doubts over ‘Brexit’, as official figures revealed that the retail sector increased by 1.4% in July, obliterating pessimistic expectations of a slender 0.1% month on month rise.

Retailers have felt the benefit of a warm summer so far, that has prompted consumers to hit the high streets, it was widely anticipated that the slump in the pound’s value would hamper sections of the retail sector, especially in the fashion industry, who often pay for their stock in dollars, but there is evidence to suggest that the sterling’s fall has alerted overseas consumers looking for advantageous deals.

The main contribution for the surprise results arrived from non food stores, where there was a hike of volume of sales just under 2.5%, in total there was a surge of 5.9% in sales, while there was a 2% fall in average store prices including petrol stations year on year, and 0.8% between June and July.

Following yesterday’s encouraging 52,000 increase in month on month employment figures, resulting in the highest amount of people being employed since records began in 1971, the UK has now received some promising data after ‘Brexit’, an abrupt  contrast to several initial negative reports.

The pound made a sharp rise on the dollar, as the retail results sunk into market sentiments, the GBP/USD is now buying $1.316, from narrow rises and falls from $1.305 this morning GMT.