Eurozone Core Inflation Won't Climb Much in Coming Months

Dow Jones
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1256 GMT - Eurozone core inflation is set to move sideways in the next few months, even as higher oil-and-gas prices push the headline rate higher, Morgan Stanley economists say in a note. Goods inflation is likely to strengthen further on the back of some transmission from higher energy costs, they say. However, broadly stable services inflation and contained wage growth should keep core inflation contained. "Still, oil and natural-gas prices remain elevated and the economy is resilient. Both factors are likely to support views that the transmission from energy to core could materialize more forcefully," the economists say. That keeps the European Central Bank on course to raise interest rates next week, they say.

 

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