This level had not been reached since the start of the publication of rates in 1997.
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The surge in prices fueled by the war in Ukraine continues, and it does not only affect France. The euro zone’s average inflation rate reached 8.6% year on year in June, a record since the indicator began to be published in 1997, according to a Eurostat estimate (PDF document) published Friday July 1st.
The 19 countries that have adopted the single currency are not affected in the same way: the Baltic countries are the hardest hit because of the importance for their economy of trade with Russia before the war, with 22% in Estonia, 20.5% in Lithuania and 19% in Latvia. Inflation reached 8.2% in Germany, while France was relatively less affected with 6.5%, the second lowest rate in the euro zone behind Malta (6.1%).
In detail, it is mainly energy prices (electricity, oil, gas, etc.) that are soaring, driven by the war in Ukraine and Western sanctions against Moscow: prices have jumped by 41.9% over a year in June. The rise is less violent on the food side (including alcohol and tobacco), but it is accelerating, with 8.9%, while it remains stable for industrial goods (+4.3%) and services (+3.4%).