(July 30): German inflation accelerated to the highest level in three months after temporary fuel-price relief expired and renewed fighting in the Middle East bolstered oil.

Consumer prices rose an annual 2.8% in July, the statistics office said on Thursday. That’s up from 2.4% in June and in line with the median estimate in a Bloomberg survey. Earlier, Spain reported a stronger-than-anticipated uptick to 3.8%

Data for France, Italy and the eurozone are due on Friday. Economists predict inflation in the latter edged up to 2.9%.

Reports on price pressures across the 21-nation eurozone in the first half of summer are a key input into the European Central Bank’s next decision on interest rates. Policymakers left borrowing costs unchanged last week, taking more time to analyse the implications of escalating attacks in and around Iran, while setting up September as an obvious moment for another hike. 

Slovakia’s Governing Council member Peter Kazimir argued that at least one more step will be needed even if the situation improves, warning that officials mustn’t allow second-round effects to emerge. His Lithuanian counterpart Gediminas Simkus said the probability of a hike is “much higher” than that of a hold.

National data showed German energy inflation accelerated 8.3%, the strongest since April.

Separate data earlier on Thursday showed Germany’s economy expanded more than expected in the second quarter, while numbers for the January-March period also saw an upward revision.

Uploaded by Felyx Teoh