BRUSSELS (Reuters) – Euro zone producer prices jumped in September more than expected, driven by skyrocketing energy costs, recording their highest increase on record in a new sign of strong inflationary pressures in the bloc, public data showed on Thursday.
The European Union’s statistics office Eurostat estimated that prices at factory gates in the 19 countries sharing the euro rose 2.7% month-on-month in September for a 16.0% year-on-year jump, in the biggest increases ever recorded for the bloc.
The jump also exceeded expectations, as economists polled by Reuters had forecast a 2.2% monthly rise and a 15.2% surge on the year.
Producers’ prices rose sharply amid a fast economic recovery after the most acute phase of the COVID-19 pandemic, a tightening of global supply chains, and a jump in gas prices.
Energy prices rose 7.7% month-on-month for a 40.7% year-on-year surge, accelerating their increase. However, total industry prices excluding energy rose only 0.6% on the month, slowing from previous months.
The rise in industrial prices mirrors the surge of consumer prices which increased in the bloc annually 3.4% in September, according to Eurostat, which has estimated a 4.1% surge in October.
Producer price rises usually translate into higher prices for consumers that the European Central Bank wants to keep rising at around 2%. The bank and euro zone finance ministers expect the inflation spike to pass in coming months and inflation to slow in 2022.
(Reporting by Francesco Guarascio; Editing by Toby Chopra)