Eurozone inflation eased again in October, hitting its lowest level in two years. Second estimates released by Luxembourg's Eurostat on Friday showed annual inflation fell to 2.9% from 4.3% in September.
Inflation rate at lowest level since 2021
Consumer prices in October rose 0.1% from the previous month. October's decline brought the single currency area's inflation rate below 3% for the first time since summer 2021.
Core inflation, which excludes volatile energy and food prices, also fell. The annual rate fell to 4.2% from 4.5% last month.
Many economists believe that core inflation is a slightly better measure of inflation trends than overall inflation because it reflects underlying inflation.
The cause was a decline in energy prices.
The fall in inflation was helped by falling energy prices. Energy prices in October fell 11.2% compared to the same month last year. Although food prices remained significantly higher than in the same period last year, food inflation slowed from 8.8% to 7.4%.
The increase in service prices was only slightly compared to the previous month.
Inflation trends continued to vary widely across euro area countries. Slovakia recorded the highest annual rate of 7.8%, while prices fell in Belgium (-1.7%) and the Netherlands (-1.0%). Germany's inflation rate was 3.0%.
Despite the significant slowdown in inflation, the European Central Bank's (ECB) medium-term inflation target of 2% remains above. The ECB has raised key interest rates significantly throughout the year to combat high inflation, but recently left them unchanged.
Inflation in the euro zone peaked at 10.6% in October last year as energy prices soared due to Russia's invasion of Ukraine.
This report has been written with some of the material from the news agency DPA.
Editor: Kieran Burke
