(Updates with European inflation in third paragraph, food and energy prices in fourth, VAT in fifth.)
Sept. 30 (Bloomberg) -- Italy’s inflation rate unexpectedly surged to the highest in almost three years in September as the price of crude oil increased.
The inflation rate based on European Union measurements rose to 3.5 percent from 2.3 percent in August, Rome-based national statistics office Istat said in a preliminary report today. That was the highest since October 2008 and compared with a 2.7 percent median forecast of 20 economists in a Bloomberg News survey. Prices advanced 1.9 percent from August.
Euro-area inflation unexpectedly jumped to 3 percent this month, the fastest in three years, from 2.5 percent in August, the European Union’s statistics office in Luxembourg said today. Inflation rates in the region are “likely to stay clearly above” 2 percent in the coming months before falling below the central bank’s ceiling in 2012, European Central Bank President Jean- Claude Trichet said on Sept. 8, basing his assessment on “moderate economic growth.”
Crude oil prices were 26 percent higher at the end of September from a year earlier. While Istat gave no breakdown for harmonized prices, it said non-harmonized costs for food and energy increased 2.3 percent and 11.7 percent this month from a year earlier, respectively.
Italy’s government last month passed 54 billion euros ($73 billion) in austerity measures in exchange for European Central Bank purchases of the nation’s bonds. The spending cuts and tax increases, which may weigh on growth, included a one percentage- point increase in the value-added tax to 21 percent that took effect on Sept. 17. Istat’s consumer-price survey was conducted through Sept. 21.
Last week, both the International Monetary Fund and the government cut their forecasts for Italian growth. On Sept. 22, the Finance Ministry said the euro area’s third-biggest economy will expand 0.7 percent this year and 0.6 percent next year, compared with April forecasts of 1.1 percent and 1.3 percent, respectively. The IMF predicted an expansion of 0.6 percent in 2011 and 0.3 percent in 2012.
--With assistance from Giovanni Salzano in Rome. Editors: Jeffrey Donovan, Andrew Davis
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