Inflation in the euro area fell to 2.9pc in October, approaching the European Central Bank (ECB) target rate of 2pc. While prices are still rising the pace slackened dramatically – from 4.3pc in October and a fraction of the double digit increases recorded in October last year.
The latest data from Eurostat, the EU’s statistics agency, puts the pace of inflation here in Ireland last monyth at 3.6pc, using the EU Harmonised Index of Consumer Prices (HICP).
The Central Statistics Office (CSO) here had recorded inflation for the year to October at 5.1pc, although it uses a slightly different Consumer Price Index (CPI).
The latest Eurostat numbers show that in some countries inflation is now back into what would be regarded as normal and even desirable bounds. In Italy, a major EU economy, inflation in the year top October was 1.8pc. However, in Belgium, Netherland and Denmark prices have fallen into decline – each recorded negative inflation, a sign of recessionary pressures.
The October data, if it carries into November and beyond, will remove the remaining pressure on the ECB or further interest rate hikes.