Euro area inflation rose to 4.0% in October on 20.8% energy inflation, with core steady at 2.5%. Retail volumes fell 0.7% and German volumes 2.0%. Markets price a December European Central Bank hike, and the data before the meeting will decide whether it comes.
Christophe Barraud flagged euro-area producer prices above 11% as likely; Eurostat printed 11.1% y/y, the first double-digit reading since February 2023, with energy PPI up 30.8%. Source
Euro area inflation hit 4.0% in October, up from 3.8%, with energy running at 20.8% year on year, according to Eurostat's flash estimate. Core, which strips out energy, food, alcohol and tobacco, held at 2.5%. The rest of the week's data showed households and firms pulling back. Two clocks are now running against each other, and the European Central Bank (ECB) has to decide which one to trust when it meets in December.
