Final June euro area inflation to confirm flash estimates at 0.2% yoy

The flash estimate of HICP inflation of euro area is seemed to be slowing down. The HICP inflation reduced to 0.2% yoy in June was 0.3% yoy in May. Similarly, core inflation was also lower at 0.8% yoy in June compared to 0.9% yoy in May. On the core components front, non-energy industrial goods increased from 0.2% yoy in May to 0.4% yoy in June, adding 5bp, notes Scoiete Generale. 

In contrast, prices paid for services proved to be the biggest drag as services inflation fell from 1.3% yoy to 1.0% yoy in June, shaving off 13bp. This decline was explained by the large drop in prices paid for services in Germany in the month of June following the spike in holiday related services in May, says SocGen.