Euro zone inflation falls in July


According to a preliminary estimate from Eurostat today, euro zone inflation eased in July to 2.5% from 2.7% in June.

The figures come despite figures earlier this week suggesting German inflation crept up to 2.4%.

Despite the fall, inflation remains higher than the ECB’s target of just below 2% – and is expected to remain above target for the short-term at least.

Earlier this month, the European Central Bank (ECB) raised interest rates to 1.5% - the second rise this year to curb inflationary pressures.

Analysts expect the central bank to maintain interest rates at 1.5% through the remainder of the year before gradually lifting them towards the 2.25% mark by the end of 2012.

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