Written by By Sophia Kiely, CNN
Icons of economic order have been linked in often-telegenic fashion for generations: the British pound adorns the cover of Time magazine, the greenback’s dollar bill sits behind German Chancellor Angela Merkel in the recent cover of Time Europe, and the euro was surrounded by London’s back streets and lanes for most of its existence.
On Saturday, the European Central Bank officially introduced this symmetry into electronic computer memorabilia. That’s because the euro, the common currency used by 16 eurozone countries, recorded its highest rate of annual inflation to date, reaching a record-high of 4.9% (rounded to the nearest 0.1%).
The euro’s leap above the 4.2% figure recorded last month makes it the latest major currency to experience price appreciation, although the ECB’s assessment says the increase is only “temporary” and warns “the latest inflation developments do not change the euro area outlook.”
While inflation only briefly hits four percent since 2008, European Union Monetary Affairs Commissioner Valdis Dombrovskis also warned of “the uneven and uneven nature of progress in inflation dynamics across the eurozone.”
Continued growth in Germany and Italy is particularly promising for the overall currency bloc. Growth in these two economies was responsible for this month’s increase, the ECB says.
This provides further evidence of a European economic recovery, with Germany now picking up speed five years after the start of the sovereign debt crisis. Moreover, the Bank of England now believes the UK economy has been accelerating over the last few months.
France’s economy is similarly poised for a fresh start under new president Emmanuel Macron. His first snap meeting with French business leaders last week resulted in a commitment to boost productivity by €350 billion over the next five years.
The Central Bank’s board meeting was delayed by three hours due to a separate strike over France’s planned pension reform, which some fear could harm French competitiveness.
Outside of euroland, the dollar and other reserve currencies are also buoyant. The dollar has been on a strong climb in recent weeks, reaching its highest level in over a year and a half.