HomeTop Global NewsEuro Zone Producer Prices Fall, Confirming Analysts' Inflation Forecasts

Euro Zone Producer Prices Fall, Confirming Analysts’ Inflation Forecasts

The European Union’s statistics office Eurostat revealed on Friday that Euro Zone producers’ prices fell month-on-month in October by 2.9%. This marks a 30.8% year-on-year rise; a significant decrease from the 41.9% annual increase in September. Such figures are serving as confirmation of analysts’ beliefs that inflation may have already reached its peak.

For the first time since May 2020, factory prices in the 19 countries sharing the euro have declined on a month-to-month basis, with economists polled by Reuters expecting a 2.0% monthly fall and a 31.5% year-on-year rise.

Energy prices were pinpointed as the main catalyst for this change in trend. A 6.9% decline in energy prices over the month pulled down the entire index. What’s more, this decrease has led to a year-on-year decline in price growth, falling from 108% in September to 65.8%.

For many economists, the inflation slowdown in October is a hopeful sign of inflation cooling down in the coming months and justification for a cooldown in European Union interest rate hikes. The European Central Bank is currently aiming to keep producer prices at 2.0% in the medium term.

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