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Eurozone inflation at 3.1% in December

The eurozone inflation remained at 3.1% in December last year, pushed by higher fuel and food prices, the European Union (EU)'s statistics bureau said on Wednesday.

The new figure, unchanged from the previous month, confirmed a previous estimate of Eurostat, which was the highest level in more than six years.

It covered the 13 EU countries sharing the same currency euro in the last month of 2007 since Cyprus and Malta joined the euro zone at the beginning of this year, bringing the number of eurozone members from 13 to 15.

Inflation in the euro zone has been rising in the previous months, due to hiking oil and food prices. It was 2.6% in October and 2.1% in September. It last hit 3.1% in May 2001, months before the euro came into circulation.

Eurostat said fuels for transport, milk, cheese, eggs and heating oil had the largest upward impacts on inflation rate, while prices for telecommunications, garments and IT equipment kept dropping.

In the 27-nation EU, annual inflation rose to 3.2% in December from 3.1% in November. A year earlier the rate was 2.2%.

Among the 27 member states, the Netherlands recorded the lowest inflation of 1.6% in December, while inflation in Latvia was the highest at 14%.

Despite mounting inflation pressure, the European Central Bank has been reluctant to raise its benchmark interest rates in the wake of financial turmoil, triggered by the US subprime mortgage market crisis. (Xinhua)