High energy and food costs in the eurozone pushed annual price rises to 4.1 per cent in July, a 10th of a point higher than the level seen in June and another record for the nine-year-old single currency region.

Eurozone inflation is running at more than double the “close to but just below” 2 per cent level the European Central Bank sees as providing price stability. But economists do not think this will usher in a rate rise in the way the previous month’s record inflation did.

Alarmed about rising prices at the end of June, the ECB raised its main rate by a quarter point to 4.25 per cent in early July. However, it gave no clue as to whether it was a one-off increase to rein in a perceived price spike or the start of a series of tightening moves.

Although the ECB’s governing council will meet again on Thursday, the consensus among economists is that it will hold rates steady for now, amid signs of an economic slowdown and a decline in energy prices.

Martin van Vliet, an economist at ING Bank, said a cooling economy and falling oil prices would have a “dampening effect” on inflationary pressures. “The most likely path is for [eurozone] interest rates to be on hold for the rest of the year.”

In the past week, eurozone statistics have suggested that economic activity in the region is slowing faster than has been expected, a gloomy picture reinforced by business and consumer sentiment surveys across the 15 countries that use the euro.

Eurostat, the EU statistical office, on Thursday said, in a first estimate of developments in July, that price increases accelerated even as the eurozone jobless rate, which had been falling until February, stagnated at 7.3 per cent.

This trend seemed consistent with the development of unemployment in Germany. It is still sinking, but at a slower rate than in 2007 or early 2008, periods in which the eurozone economy showed little impact from year-old financial-market woes.

The German statistics office said unemployment adjusted for seasonal factors fell 20,000 in July from June to a rate of 7.8 per cent. Between the start of the year and the end of March, by contrast, monthly declines had averaged 67,000.

Nick Matthews, an economist at Barclays Capital, said the “sharp downswing” in eurozone economy and a continued fall of oil prices could push August inflation as low as 3.9 per cent. That would be the first month-on-month decrease in a year.

But some economists expect even off-peak oil prices to push inflation yet higher next month. For this reason, Nick Kounis, an economist at Fortis, said: “We still think further tightening [in monetary policy] remains likely in the coming months.”