(MENAFN– ecpulse) Euro area inflation lingered in June as low energy and food costs continued to weigh on the index.
CPI for the year ended June (final reading) remained unrevised at 0.5 percent, moving in line with analysts’ forecasts.
Energy costs soared 0.1 percent after posting 0.0 percent the previous month, while alcohol, food and tobacco prices tumbled 0.2 percent from a previous of 0.1 percent advance.
On the monthly basis, the CPI reading soared 0.1 percent from the preceding of -0.1 percent, while annual core CPI edged up 0.8 percent from 0.7 percent increase in May.
The ECB said this month inflation expectations remain firmly anchored, yet to remain at low levels over the coming months, Draghi said.
The ECB sees upside, downside risks to inflation outlook, where the ECB predicts the rate to increase gradually in 2015 and 2016.
Policymakers are trying to avoid deflationary pressures as it is currently the maim threat to euro area recovery.
In June, The ECB decided to cut its key interest rates, targeted longer-term refinancing operations, preparatory work related to outright purchases of asset-backed securities and a prolongation of fixed rate, full allotment tender procedures.
A firmer euro exchange rate is a threat to the sustainability of the euro area recovery, ECB President Mario Draghi said this week, where another risk comes from the escalating geopolitical tensions in Ukraine.
As of 09:20 GMT, the euro traded slightly higher versus the U.S. dollar, following its drop over the previous two sessions, to hover around 1.3530.
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