Yearly inflation in euro nations hit a record 4 percent in June, the EU statistics agency Eurostat said Monday, adding pressure on the European Central Bank to raise borrowing costs even as the economy slows.
Facing soaring fuel and food costs, ECB officials have signaled they may hike their key interest rate on Thursday from 4 percent to 4.25 percent to try to cool prices _ although this raises costs for home buyers and companies seeking credit, further slowing a stalling economy.
It may also weaken the dollar by encouraging investors to seek higher returns by placing funds in higher-interest euro currency accounts _ and send oil prices higher as well.
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