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Euro Zone inflation hits new record high

  • By Al Mayadeen English
  • Source: Agencies
  • 31 May 2022 16:18
  • 1 Shares
2 Min Read

Prices in the euro zone continue to record new highs for the seventh month in a row.

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  • German inflation came in at an annual 8.7% in May (Reuters)
    German inflation came in at an annual 8.7% in May (Reuters)

Inflation has been surpassing expectations in the euro zone, with prices continuing to hit record highs for the seventh month in a row.

It was predicted that inflation would be at 7.8% in May, but it came in at 8.1%, up from April 7.4%, according to figures from Europe's statistics office.

Several major European economies have had increases in their inflation in recent days, with Germany's recording an annual 8.7% in May, significantly past the predicted 8% mark, and April 7.8%. France's inflation recorded 5.8%, up from 5.4% in April, and Spain's was at 8.5%, exceeding expectations of 8.1%.

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Energy costs in the euro zone increased by 39.2%, and food, alcohol and tobacco costs increase by 7.5%. Even without taking these increases into account, inflation increased from 3.5% to 3.8% according to Eurostat.

EU leaders had agreed late on Monday to ban 90% of Russia's crude oil by the end of 2022, immediately driving prices higher.

Back in March, calculations by the German Institute for Economic Research (DIW) in Berlin showed that if the German economy regularly adjusted to no longer rely on Russia for oil and gas, the corresponding restructuring would require up to a decade. The repercussions will also reflect on the volume of economic production in the country, as it will decrease by 3% within 18 months, data showed.

Later in April, Deputy CEO of Deutsche Bank, Karl von Rohr, Germany’s inflation rate could reach 10% if energy imports are limited.

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