Euro area inflation hit 4.0% in October on 20.8% energy, with core flat at 2.5%. Markets still price an 85% chance of a December ECB hike, and the Bundesbank's Nagel and the Riksbank are both leaning on forecasts, not wage data.
Eurostat’s October flash puts energy at 20.8% y/y as the driver of the first 4% euro-area print since 2023, while core HICP held at 2.5%. Source
Euro area inflation reached 4.0% in October, according to Eurostat's flash estimate of the Harmonised Index of Consumer Prices (HICP). It matched the 4.0% consensus, up from 3.8% in September, and is the highest reading since September 2023. Energy did nearly all the work, at 20.8% year-on-year against 18.9%. Core, which strips out energy, food, alcohol and tobacco, was unchanged at 2.5%. Services inflation edged up 0.1 percentage points to 3.3%.
