Euro Area inflation rate confirmed at 28-month low

The annual inflation rate in the Euro Area was confirmed at 2.4% in November, final data showed, or the lowest level since July 2021.

Prices increased at a slower rate for services (+4% YoY versus +4.6% YoY in October), non-energy industrial goods (2.9% YoY versus 3.5% YoY in October) and for food, alcohol and tobacco (6.9% YoY versus 7.4% YoY in October).

In November, the cost of energy plummeted 11.5% year-on-year, compared with an 11.2% drop in October.

Annual core CPI inflation, which excludes volatile categories such as food and energy, was also confirmed at 3.6% in November. It has been the lowest core inflation rate since April 2022.

European Central Bank President Christine Lagarde said at the regular press conference following the bank’s latest policy decision that, in December, inflation was likely to accelerate on account of an upward base effect for the cost of energy.

In 2024, inflation is expected to decelerate more slowly due to further upward base effects, according to Lagarde.

The Euro was a notch firmer on the day against the US Dollar, with the EUR/USD currency pair last trading at 1.0943, looking to extend last week’s 1.25% gain.