Eurozone inflation up to 1.6% in June

Eurozone inflation rose to 1.6 percent in June from 1.4 percent in May, EU data agency Eurostat said on Tuesday, with the figure for powerhouse Germany jumping from 1.6 to 1.9 percent. The rise was mainly due to an increase in energy prices. Despite the increase, inflation for the zone, with 17 members in June, is far from the rate of 2.4 percent reached in June 2012. But it means there has been a big increase since from the 38-month low point of 1.2 percent in April The data, in a second estimate, showed that inflation rose in France, Italy, Spain and the Netherlands. Analyst Howard Archer of London-based IHS Global Insight said that the trend "does not signify any marked pick-up in underlying inflationary pressures. "Rather it reflects difficult base effects as energy prices had fallen sharply in June 2012. Core inflation was stable and limited to just 1.3 percent in June and virtually all the latest evidence points to still muted underlying inflationary pressures across the eurozone." The European Central Bank aims to keep inflation to just below a 2.0 percent in the medium term.