Leaves in the vineyards turn yellow at the end of the harvest season in Seven Mountains along the Rhine River in Bonn, Germany, on October 25, 2024.
Noor Photos | Noor Photos | Getty Images
Preliminary data released by Eurostat on Thursday showed that the inflation rate in the 20 euro zone countries rose to 2% in October.
Economists polled by Reuters had forecast an overall figure of 1.9%. The overall data for September was revised down to 1.7% from 1.8% on October 17, which was lower than market expectations.
Core inflation remained unchanged at 2.7%, also slightly higher than the 2.6% forecast.
The latest inflation data released on Thursday is considered crucial in determining whether the European Central Bank will consider implementing a sharp half-percentage point interest rate cut at its next meeting in December.
The central bank has cut interest rates three times so far this year, each time by a quarter of a percentage point, taking the central bank’s key interest rate from 4% to 3.25%.
The market currently expects another 25 basis points interest rate cut in December.
Traders were also considering the latest euro zone growth data, which showed better than expected Expanded 0.4% in the third quarterdespite analysts predicting further weakness ahead.
The European Central Bank said at its October meeting that sluggish economic activity in the euro zone had strengthened confidence that inflation would not recover significantly.
This is a breaking news story and will be updated soon.
