The inflation rate in the Eurozone weakened once again in October, reaching its lowest level in more than two years. According to a second estimate by the statistical office Eurostat in Luxembourg, the annual inflation rate fell to 2.9 percent from the previous 4.3 percent. This confirms the initial survey. Compared to the previous month, consumer prices rose by 0.1 percent in October.
With the decline in October, the inflation rate in the common currency area fell below the three percent mark for the first time since summer 2021. Core inflation, which excludes volatile prices for energy and food, also declined. In this regard, the annual rate fell from 4.5 percent in the previous month to 4.2 percent. According to many economists, core inflation reflects the underlying price development and therefore provides a slightly better indication of the inflation trend than the overall rate.
Although food and non-alcoholic beverages were still significantly more expensive than a year ago, price growth weakened from 8.8 percent to 7.4 percent. Prices for services increased marginally less than in the previous month. Energy prices in October decreased by 11.2 percent compared to the same month last year.
Inflation developments varied greatly among the individual countries in the Eurozone. Slovakia had the highest annual rate at 7.8 percent. Prices in Belgium (-1.7 percent) and the Netherlands (-1.0 percent) decreased compared to the previous year. In Germany, inflation stood at 3.0 percent.
Despite the significantly weaker inflation, the European Central Bank (ECB) continues to exceed its medium-term inflation target of two percent. The ECB had raised its key interest rates significantly over the course of a year in the fight against high inflation, but has recently left them unchanged.