Prices of fuels for transport, gas and heating oil boosted euro zone inflation in April to an expected 2.4 per cent year-on-year from 2.2 per cent in March, the European Union's statistics agency Eurostat revealed today.
Month-on-month prices grew 0.7 per cent in April.
The monthly rise was driven mainly by fuels for transport, but also by rising prices of clothes and footwear.
The European Central Bank wants to keep annual inflation below but close to 2 per cent.
However, markets expect it will raise interest rates by 25 basis points or more in June to stem inflationary pressures from expensive energy and fast credit growth as the euro zone economy picks up steam.
Price growth excluding energy and unprocessed food costs, or what the ECB calls core inflation, was 0.4 per cent month-on-month in April and 1.6 per cent year-on-year, up from 1.4 per cent in March, above expectations of 1.4 per cent.
Economists look at core inflation to see if the rises in oil prices affect prices in other sectors of the economy.
The ECB wants to prevent such second-round effects which also include wage growth with tighter monetary policy.
ECB Chief Economist Otmar Issing was quoted as saying yesterday that risks of faster price growth were rising.
"We certainly see upside risk in price stability. This strong vigilance policy does not imply any commitment to the timing or magnitude of any monetary policy change," Mr Issing said.
"In this climate second-round effects could appear, although up till now the moderating influence of salaries has stayed in place," he said.
In the whole EU of 25 member states, annual inflation rose 0.7 per cent month-on-month for an annual rise of 2.3 per cent in April from 2.1 per cent in March.