BRUSSELS—The eurozone’s annual rate of inflation rose faster than expected in May, official data showed Friday, but the European Central Bank is still seen cutting interest rates next week.
Consumer prices in the single currency area rose 2.6 percent in May from a year earlier, up from April’s 2.4-percent rate, the EU’s statistics agency said. The figure is above the ECB’s two-percent target.
ECB officials will be disappointed by the data for core inflation, which strips out volatile energy, food, alcohol and tobacco prices and is a key indicator for the bank. The data showed its rate ticked up to 2.9 percent in May from 2.7 percent in April. Analysts surveyed by FactSet and Bloomberg had forecast that consumer prices would rise to 2.5 percent and predicted that core inflation would be stable. The figures are, however, unlikely to stop the ECB from lowering rates on June 6, analysts said.
