An initial official estimate showed that annual euro-area inflation in August remained at July’s level, contrary to market expectations of a decline. Higher unprocessed food and service prices offset part of the drop in energy prices. Eurostat said prices rose 0.2 percent year on year, unchanged from July, while economists polled by Reuters had expected only 0.1 percent.
Falling energy prices were the largest downward influence on the overall index: oil prices fell 7.1 percent in August compared with a year earlier. Unprocessed food had the strongest upward effect, with prices rising 2.3 percent year on year. Excluding volatile energy and unprocessed food prices—a measure the European Central Bank calls core inflation—retail prices rose 0.9 percent annually in August, unchanged from July.