Euro zone inflation slowed a touch in October and continued to hover near the European Central Bank’s 2% target, confirming the bank’s message that the economy remains on the relatively benign path it projected earlier.<\/p>\n
Inflation in the 20 nations sharing the euro currency slowed to 2.1% from 2.2% in September, in line with economists’ forecasts in a Reuters poll, as quicker services price growth was offset by lower energy costs, figures from Eurostat showed today.<\/p>\n
A closely-watched figure on underlying inflation, which excludes volatile food and fuel prices, meanwhile held steady at 2.4%, defying expectations for a slowdown, as services inflation picked up to 3.4% from 3.2%, offsetting a drop in industrial goods inflation.<\/p>\n
The ECB held interest rates steady on Thursday, arguing that inflation was on target and some of the worst risks related to economic growth had declined, keeping the bloc on a path for acceptable, if unspectacular, growth.<\/p>\n
The ECB sees inflation dipping below 2% next year before a rise back to target in 2027, an outlook that was supported on Friday by a separate ECB survey, which is often a key input into policy deliberations.<\/p>\n
This relatively healthy inflation outlook is a key reason why economists think the ECB is done cutting interest rates and financial markets only see a 40% chance of one last cut by the middle of next year.<\/p>\n
The bank has already lowered rates by a combined 2 percentage points in the year to June and given long lags in policy transmission, this is still filtering through to the real economy.<\/p>\n
Still, some policymakers argue that risks are skewed towards inflation going too low. They say that prices will dip below 2% early next year on statistical base effects and this could change firms’ price expectations, making low inflation self-fulfilling.<\/p>\n
But others say that the economy has performed better than feared and a raft of surveys, including the ECB’s own poll of companies, is pointing to improved activity.<\/p>\n
This improvement should alleviate some of the fears about the economy and limit downside risks to inflation, they argue.<\/p>\n","protected":false},"excerpt":{"rendered":"Euro zone inflation slowed a touch in October and continued to hover near the European Central Bank’s 2%…\n","protected":false},"author":2,"featured_media":55744,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[72,113,61,60],"class_list":["post-115025","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-economy","tag-ie","tag-ireland"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/115025","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/comments?post=115025"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/115025\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media\/55744"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media?parent=115025"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/categories?post=115025"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/tags?post=115025"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}