Eurozone inflation falls to 10 percent British economy fears abolition of EU rules

Eurozone inflation fell from record levels in November. Consumer prices rose by 10 percent compared to the same month last year, statistics bureau Eurostat announced on Wednesday.

In October, inflation peaked at 10.6 percent. Experts had expected a drop, but only to 10.4 percent.

Energy prices continue to rise the most, but not as much as in the previous month. Compared to November 2021, they were still 34.9 percent higher. Prices of food and luxury goods rose by 13.6 percent. Here the upward trend in prices increased. Prices of other goods rose by 6.1 percent. Services were 4.2 percent more expensive than one year ago.

Core inflation excluding energy and food was a constant 5 percent. Economists pay particular attention to this figure because it gives an indication of the extent to which companies pass on cost increases, particularly for energy, in consumer prices. This can lead to so-called second-round effects in the form of higher wage demands. Experts speak of a price-wage spiral.

The European Central Bank’s medium-term price target of 2 percent has clearly been exceeded. However, there is some debate over whether the monetary authorities will slow down their pace of tightening any time soon. The background is the weakening economy, which is suffering from the consequences of the war in Ukraine. It is currently unclear whether the ECB intends to raise interest rates by another 0.75 point or 0.5 point at its next meeting in mid-December. (aeg/sda/awp/dpa)