Euro zone inflation reaches six-year maximum in October

In October, euro zone inflation demonstrated its fastest tempo for almost six years, powered by energy prices. That’s what the European Union statistics agency uncovered on Friday. The given outcome is in line with the agency’s earlier forecast.

Without food and energy, the core inflation measure was updated downwards.

As Eurostat informed, in October, consumer prices in the 19 countries of the euro zone headed north by 2.2% year-on-year after September’s 2.1% rally and August’s 2% leap. It appeared to be the biggest leap since December 2012.

Apparently, the headline figure backs the ECB’s decision to conclude its price-boosting bond-purchasing program at year-end due to the fact inflation is currently overshooting the bank’s objective of price surge below, although close to, just 2% over the medium term.

In less upbeat news for the European Central bank, inflation without the volatile components of energy and also unprocessed food, which is the key gauge that the ECB watches in its policy verdicts, was updated downwards by Eurostat to about 1.2% on the year, from a previous forecast of 1.3%. However, it was still soaring faster than the 1.1% leap reported in September.

In October, headline inflation rallied by up to 0.2% on the month, which is in line with market hopes. However, it speeded down from September’s 0.5%.

The narrower core indicator, observed by a great number of investors, excluding alcohol, tobacco, food, and energy, amounted to 1.1% on the year.

The soar in headline inflation was mostly powered by energy prices that surged by 10.7% in October year-on-year, while prices for other industrial products ascended by just 0.4%.

Inflation in the services sector, which appears to be the largest in the euro zone, accounted for 1.5% on the year, although prices sank by 0.3% on the month.

Similar

30.03.2021 18:38 Australia's iron ore export is forecast at record high

According to the recent report by the Australian Department of Industry, the country is forecast to earn around 136 billion Australian dollars from the ore exports this year.