Yearly inflation in euro nations hit a record 4 percent in June, the EU statistics agency Eurostat said Monday.

Soaring prices for fuel and food are raising pressure on the European Central Bank to raise interest rates for the first time in a year when it meets this week.

Inflation is Europe’s biggest economic headache as consumers pay far more at the gas pump and food, and steer clear of major purchases.

ECB officials have signaled they may hike borrowing costs from 4 percent to 4.25 percent to try to cool prices.

This would be the first time they have shifted the rate since June 2007 despite major cuts from the U.S. Federal Reserve and the Bank of England, who moved to encourage reluctant banks to lend in the wake of a credit market crisis.

The inflation figure for June tops the previous record of 3.7 percent in May, far above the ECB’s recommended guideline of just under 2 percent. Eurostat says inflation has not been higher since it started keeping records for each euro nation in 1996.

The European economy appears to be slowing sharply after a brief boom _ triggered by exports to a swelling global economy _ cut jobless rates to record lows.

Confidence in the 15 nations that share the euro dropped to a near three-year low in June and inflation is now a major worry.

Oil prices have quadrupled in the last seven years, hitting Europeans hard because they also pay heavy taxes on fuel that can cost them some 80 euros ($126) to fill up a tank of a passenger car.

Fishermen and truck drivers say that surging fuel prices are threatening their livelihoods, and have protested, sometimes violently, in recent weeks.

Oil rose near a record high in Asian trading on Monday, above $142 a barrel, as expectations of a weaker dollar spurred investors to seek refuge in dollar-denominated oil futures to protect themselves from inflation.