According to preliminary data released on Wednesday, the euro zone consumer price index jumped in December to more than three-year highs, while price pressures remained far enough away from the target of the European Central Bank (ECB) of 2%.
The Eurostat report says that inflation in consumer prices to a seasonally adjusted increased in December by 1.1%, surpassing the growth forecast of 1.0%, and the final figure for the previous month was 0.6%.
The Statistical Office of the European Union notes that the rise in inflation was fueled by electricity prices, as well as services, food, alcohol and tobacco.
The base consumer price index, which does not include the cost of food, electricity, alcohol and tobacco, rose unexpectedly in December (seasonally adjusted) by 0.9%. Analysts predicted the indicator to remain unchanged at the previous level of 0.8%.
Despite the increase in the main index, which reached its highest level since September 2013, inflation continues to remain below the ECB's target level, which is 2%.
The next meeting of the European Central Bank will be held on 19 January. It is expected that the regulator would leave rates at the current level, and the program of quantitative easing (QE) unchanged.
Around 15:00 GMT, EUR/USD pair is trading near the 1.0434 mark, while GBP/USD is at 1.2260.
The European stock markets are mixed: Euro Stoxx 50 index rose 0.04%, Germany's DAX fell 0.26%, France's CAC 40 lost 0.04%, and London's FTSE 100 gained 0.05%.
The index of business activity in the services sector in the euro area rose in the last quarter contrary to expectations. This is evidenced by industry statistics released Wednesday. According to the report prepared by the research organization Markit, the index was 53.7 compared with 53.1 in the previous quarter. The experts expected it to keep at the level of the previous quarter at 53.1.