Eurozone producer prices rise more-than-expected in Dec, driven by soaring energy costs

Preliminary data from European Union's statistics office Eurostat showed Thursday that Euro zone producer prices rose by more than expected in December due to much more expensive energy. Eurozone industrial producer prices rose 0.7 percent month-on-month in December for a 1.6 percent year-on-year increase. 

Producer price inflation for the year surged in December at the fastest pace in nearly four years. The latest increase was the fastest since January 2013, when producer prices increased 1.7 percent. Data for December compared to expected a rise of 0.4 percent m/m and 1.3 percent y/y respectively.

The volatile energy component jumped 2.1 percent month-on-month and by 3.9 percent from a year earlier. Excluding the volatile energy component, producer prices in December edged only slightly higher. Without the energy component, producer prices were up 0.3 percent month-on-month and 0.9 percent year-on-year.

Markets await European Central Bank (ECB) President Mario Draghi’s speech scheduled for later in the day. Also, investors are looking forward to the release of December retail sales data due on Friday.

Meanwhile, FxWirePro's Hourly EUR Strength Index remained neutral at 49.5043 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex.