OSLO: Norway's consumer price inflation accelerated at the fastest pace since late 1988 and producer prices continued to log strong growth on energy prices in June, Statistics Norway said on Monday.
Consumer price inflation rose more-than-expected to 6.3 per cent in June from 5.7 per cent in May. A similar high inflation was last reported in October 1988.
Inflation was forecast to advance moderately to 5.9 per cent in June.
The annual increase was driven by the 11.7 per cent rise in transport cost and the 8.3 per cent increase in housing, water, electricity, gas and other fuel costs.
Food and non-alcoholic beverages prices gained 5.0 per cent.
On a monthly basis, consumer prices moved up 0.9 per cent in June, faster than the expected increase of 0.6 per cent, data showed.
Core inflation that excludes energy prices and tax changes, accelerated to 3.6 per cent in June from 3.4 per cent in the previous month. The 3.6 per cent was the highest since August 2020.
The EU harmonised inflation increased to 7.0 per cent in June from 6.2 per cent in May.
Month-on-month, the harmonised index of consumer prices rose 1.1 per cent .
In June, the central bank had raised its benchmark rate by 50 basis points to 1.25 per cent.
The services-driven increase in the core inflation rate in June increases the chance that the Norges Bank will raise its policy rate by another 50 basis points at its August policy meeting, David Oxley,an economist at Capital Economics, said.
In a separate report, the statistical office said producer prices grew 7.2 per cent on month in June, which means that PPI total is back to the same level it was before the fall in April 2022.
The price on extraction of oil and natural gas together climbed 14.4 per cent in June.
Problems with delivery of natural gas from Russia to Europe were a significant contributor to the price increase on natural gas.
On a yearly basis, producer prices advanced 68.8 per cent in June, faster than the 64.6 per cent surge in May. -- dpa
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