Europe’s Inflation Rate Rises To 2.3% - InvestingChannel

Europe’s Inflation Rate Rises To 2.3%

The inflation rate across the European Union (EU) has risen to an annualized 2.3% in November, according to statistics agency Eurostat.

The latest inflation reading matched the consensus expectation of economists polled by the Reuters news agency.

However, the November inflation rate was up from 2% in October and ahead of the European Central Bank’s (ECB) 2% target.

Consumer prices throughout Europe have now risen for two consecutive months after falling to an annualized rate of 1.7% in September.

The latest rise in inflation is being blamed on an uptick in energy prices heading into winter.

Core inflation, which excludes volatile energy, food, alcohol and tobacco prices, remained unchanged in November at an annualized rate of 2.7%.

The core rate is being kept aloft by service inflation, which rose 3.9% in November after advancing 4% in October of this year.

The latest inflation reading appears to have cemented expectations for the European Central Bank to lower interest rates another 25-basis points at its December meeting.

Financial markets have fully priced in a quarter percentage point rate cut in December, which would mark the central bank’s fourth reduction this year.

The European Central Bank is scheduled to make its next decision on interest rates Dec. 12.

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