BRUSSELS, May 31 (Xinhua) -- The eurozone annual inflation jumped to 1.9 percent in May, matching the European Central Bank's target inflation of "below, but close to 2 percent," according to a flash estimate by Eurostat, the statistical office of the European Union (EU) on Thursday.
The uptick is mainly due to a sharp rise of energy prices, which were up 6.1 percent year on year, compared with 2.6 percent in April. The price of food, alcohol and tobacco also increased 2.6 percent.
The core inflation, which excludes the volatile energy and food prices, recorded at 1.1 percent, compared with 0.7 percent in the previous month.
After years of pushing for inflation to return to just under 2 percent, it could not have come at a more difficult time.
Bert Colijn, a Senior Eurozone Economist at ING said eurozone financial market turmoil has returned because of Italian politics this week and weakening economic data over the past months. The United States seems on the brink of announcing tariffs on European steel and aluminium, which clouds the exports outlook and could have an additional inflationary impact if the trade conflict gets out of hand.
The ECB could just hint at an extension to QE while taking another six weeks to see how the political situation in Italy and the trade conflict with the U.S. play out, and take in more economic data, said the economist.
"As this jump in inflation just thinly masks underlying core weakness and uncertainty about the economy is high, it is unlikely to convince the ECB to normalize policy more quickly," added Colijn.
