Vienna  - Austria's inflation reached 4.0 per cent in June, up from 3.7 per cent in May, the highest in 15 years amid rising fuel and food prices, the country's statistics office reported Wednesday.

June's figure was the highest since a 3.9 per cent inflation rate recorded in April 1993.

Rising fuel and food prices accounted for more than 60 per cent of the inflation, the statistics office said. The cost for fuels rose 32 per cent on average since June 2007, while food prices rose by 7.4 per cent on average.

Continuing high inflation, together with negative effects of the world economy, could bring Austria close to stagnation in 2008, analysts said.

The Austrian economy would reach "the brink of stagnation" in the second half of 2008, analysts at Bank Austria said Wednesday, citing rising prices and lower consumer demand among the key factors.

The economic growth indicator rose 1.7 per cent in June, down from 2.4 per cent in the previous month. It was the biggest month-on-month decline in more than five years.

The strong Euro, high fuel prices and the effects of the real estate crisis in the United States would also have dampening effects on the growth of the Austrian economy, the bank said. (dpa)