Eurozone Inflation October 2016


Eurozone: Inflation hits over two-year high in October

November 17, 2016

Complete data released by Eurostat on 17 November confirmed that harmonized inflation was 0.5% in October, above September’s 0.4% and the highest reading seen since April 2014. The result was in line with the preliminary estimate. According to Eurostat, a less negative impulse from energy prices led to October’s rise in inflation.

Core inflation inched down to 0.7% after resting at 0.8% for four consecutive months. Annual average inflation was steady at September’s 0.1%. Meanwhile, harmonized consumer prices increased 0.3% in October on a monthly basis, after rising 0.4% in September.

Looking at the countries in the common-currency bloc, 14 of the 19 Eurozone economies showed inflation rates equal to or above the regional average. Belgium (1.9%), Austria (1.4%) and Latvia (1.1%) were the economies with the highest rates. In contrast, Cyprus (-1.0%), Ireland (-0.5%) and Slovakia (-0.3%) were the economies that registered the largest annual declines in HICP consumer prices. Among the largest economies in the Eurozone, inflation rose in Germany (0.8%) and Spain (0.5%). Inflation was stable at September’s 0.5% in France, while consumer prices fell 0.2% annually in Italy.

FocusEconomics Consensus Forecast participants see inflation in the Euro area averaging 0.3% in 2016, which is up 0.1 percentage points from last month’s forecast. For 2017, panelists expect inflation to average 1.3%, which is unchanged from last month’s forecast.

Author: Angela Bouzanis, Lead Economist

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Eurozone Inflation Chart

Euro Inflation by country October 2016

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

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