Euro Area Inflation October 2020

Euro Area: Pace of decline in annual prices stable in October

October 30, 2020

Harmonized consumer prices fell 0.3% compared to the same period of the previous year in October, matching September’s decrease. Inflation thus remained below the European Central Bank’s target rate of near, but under, 2.0%. October’s drop was due a sharp fall in prices for energy and to somewhat lower prices for non-energy industrial goods. On the other hand, prices for services and for food, alcohol and tobacco rose.

On a monthly basis, harmonized prices increased 0.2% in October, matching September’s rise. Core inflation, which excludes volatile energy and unprocessed foods prices, was stable at September’s 0.4% in October.

A complete set of data for harmonized inflation will be released on 18 November.

Commenting of the release, Bert Coljin, senior Eurozone economist at ING, stated:

“With new lockdowns, the outlook for inflation for the start of the new year will be weakening too, largely justifying the ECB’s very dovish tone at yesterday’s press conference.”

FocusEconomics panelists see inflation averaging 1.0% in 2021, which is unchanged from last month’s estimate, before picking up to 1.3% in 2022.

Author: Massimo Bassetti, Senior Economist

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Euro Area Inflation Chart

Euro Area Inflation October 20 20

Note: Year-on-year and month-on-month var. of harmonized consumer price index (HICP) in %.
Source: Eurostat

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