ECB on Course to Raise Rates as Euro Area Inflation Hits 3.3%

The European Central Bank (ECB) is expected to raise its policy rate next week as euro area inflation rose to 3.3% in August, driven by a rise in energy prices.

Eurostat reported that energy prices increased by 14.3% from a year earlier, compared with a 10.3% annual rise in July. Services inflation slowed to 3.0% from 3.3%, while prices for non-energy industrial goods rose by 1.2%, up from 0.9%. Food, alcohol and tobacco inflation remained at 1.2%

The ECB's medium-term inflation target is 2%, and the euro area figure remains above this target.