Eurozone Inflation Rises to Highest in 20 Months

Eurozone inflation in July was the highest in 20 months, new data shows.

Annual inflation in the 16-country bloc rose to 1.7% last month, from 1.4% in June, BBC News reported. The July figure is the highest since November 2008.

Increased prices for transportation fuel, alcohol and tobacco helped boost annual inflation.

Countries including Finland, Greece and Spain raised their value-added taxes in July, which also stoked inflation.

"The core inflation rate is slightly higher, but with the VAT hikes that there have been in the eurozone, that's not surprising," Astrid Schilo, an economist at HSBC, told BBC News.

On a month-on-month basis, eurozone prices dropped 0.3% in July.