MercoPress. South Atlantic News Agency

Stable prices in US and EU.

Retail prices in United States increased 0,3% during June signaling inflation is not an immediate risk for the world's leading economy. According to the latest release from the US Department of Labor the June index marked an important drop from May when retail prices jumped 0,6%.

However, economists were forecasting a 0,2% increase meaning that food and energy continue to threat the accumulated retail price.

If food and energy prices are not included the retail price index last June increased 0,1%, (compared to 0,2% in May), and the lowest since December 2003.

Meantime in the Euro-zone excluding volatile items as energy, food and alcohol, inflation rose last June from an annualized 1,8% to 1,9%. The European Central Bank has targeted 2004 inflation below 2%. Analysts believe prices in the Euro-zone will remain stable for the rest of the year given the weak domestic demand. Energy prices in the Euro-zone have risen 5,9% in the last twelve months but actually dropped 0,7% last June.

Contrary to the US Federal Reserve that has began a gradual increase of interest rates which remain the lowest in decades, the European Central Bank considers there is no need to follow the same path. ECB president Jean Claude Trichet during a forum in Singapore confirmed "there's no reason to change the current ECB monetary policy" since inflation remains in line with the "objective" and current interest rates are favourable for job creation in the Euro-zone.