Inflation in Germany and France, the eurozone鈥檚 biggest economies, rose in September, data showed Tuesday, fuelling expectations the European Central Bank (ECB) will not make further interest rate cuts in coming months.
Annual inflation in Germany, Europe鈥檚 top economy, came in at 2.4 per cent according to preliminary data from federal statistics agency Destatis, up from 2.2 per cent the previous month.
The figure, slightly above analyst estimates, was driven by increasing costs for services and goods.
Under the 鈥渉armonised鈥� metric favoured by the ECB, consumer prices also rose by 2.4 per cent, up from 2.2 per cent in August.
French annual inflation accelerated to 1.2 per cent in September, up from 0.9 per cent in August, also driven by rising services costs, according to the INSEE statistics agency.
Under the harmonised rate, consumer prices rose 1.1 per cent in September compared to 0.8 per cent in August, according to INSEE鈥檚 provisional estimate.
In Italy, the euro area鈥檚 third-biggest economy, annual inflation remained stable in September at 1.6 per cent, according to official data.
Under the harmonised rate, consumer prices rose to 1.8 per cent this month from 1.6 per cent in August.
Following a string of cuts to support the struggling eurozone economy, the ECB has kept interest rates on hold for its past two meetings, with inflation hovering around its two-per cent target.
Stephanie Schoenwald, an economist with German public lender KfW, said the latest eurozone data showed that 鈥渢he ECB was right in its decision to end its monetary easing policy, especially as price pressure in the services sector is once again proving persistent鈥�.
The central bank for the 20 countries that use the euro holds its next rate-setting meeting on October 30.
Most economists expect the ECB to hold rates steady until at least the end of this year.