Daily Times

Eurozone inflation soared in February to a record high of 5.8pc, mainly on the back of surging energy prices, the EU’s official statistics agency Eurostat said Wednesday. The acceleration, from 5.1pc in January, was announced as oil and gas prices rocketed even higher over fears about the impact on supplies from Russia’s invasion of Ukraine. Brent crude topped $110 a barrel for the first time since 2014 and WTI followed suit hours later to hit the highest level since 2013. European natural gas prices similarly hit a record level. The surge in inflation comes at a difficult time for European leaders as they warn their citizens of the “price to pay” from tough sanctions imposed on Russia, the EU’s leading foreign gas supplier. Policymaker’s fear soaring inflation could choke off the EU’s recovery from the coronavirus pandemic. Eurostat said energy prices in February jumped 31.7pc, faster than the 28.8pc recorded in January. Food prices were up 4.1pc in February, compared with 3.5pc the previous month. Analysts at Capital Economics predicted inflation would hit 6pc in the coming months before falling back to around 4pc, “most likely” at the end the year. That is still double the European Central Bank’s target of around 2pc. Capital Economics warned that not only energy prices, but also food prices could rise further due to the conflict in Ukraine, a major wheat exporter.