Eurozone annual inflation slowed to 2.9%

Annual inflation in 20 eurozone countries in October slowed to the lowest level since July 2021. 2.9% after 4.3% in September and 5.2% in August, follows from preliminary assessments Eurostat.

Prices for food, alcohol and tobacco rose 7.5% compared with 8.8% last month. Price growth in the services sector slowed from 5.5% in September to 4.6%, and in the segment of non-energy industrial goods – from 4.2% to 3.5%. Energy prices fell 11.1% after a 4.6% decline a month earlier.

Core inflation [показатель, в котором не учитываются цены на энергоресурсы и продовольствие] slowed in the eurozone from 4.5% to 4.2% year on year – the lowest value since July last year. Among the eurozone countries for which statistics for October are already available, annual inflation reached the highest values ​​in Slovakia (7.8%), Croatia (6.7%) and Slovenia (6.6%). Deflation was recorded in Belgium (-1.7%) and the Netherlands (-1%).

Along with slowing annual inflation decreased and the eurozone economy: according to the results of the third quarter, the GDP of its member countries decreased by 0.1% (after growing by 0.2% in the second quarter). The GDP of the EU member countries, in turn, increased by 0.1%. Compared to the third quarter of 2022, the figure for the eurozone and the EU increased by 0.1%.

How writes Reuters, such statistics mean that the European Central Bank (ECB) has almost certainly completed a string of 10 consecutive interest rate hikes and will monitor the consequences of these policies before taking further steps.

Following the meeting on October 26, the ECB maintained all three types of interest rates, Vedomosti wrote: the rate on main financing operations remained at 4.5%, on deposits – 4%, the rate on margin loans – 4.75%. The regulator’s decision coincided with market expectations.