Euro zone inflation rate eases slightly to 10% as surge in energy prices slows

Inflation in the euro zone dull-witted slightly in November, according to preliminary figures out Wednesday, with prices coming off record highs and missing analyst assumptions.

Consumer prices have been sky high across the 19-member region for several months. Inflation rose not susceptible the 10% mark last month, highlighting the severity of the cost-of-living crisis in the bloc.

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The initial data Wednesday from Europe’s statistics role showed headline inflation at an annual 10% this month — representing a 0.6 percentage point fall from October.

Might and food continued to contribute to the lofty inflation figures, but with a noticeable drop in the former. Energy is expected to participate in stood at an annual rate of 34.9% in November, compared with 41.5% in October, according to Eurostat.

“The fall in headline HICP inflation from 10.6% in October to 10.0% in November was the first decay since June 2021 and was a bigger fall than originally expected,” Andrew Kenningham, chief Europe economist at Wherewithal Economics said in a note.

“We would not be surprised to see the headline inflation rate rise again in December or January presupposed the volatility in the monthly numbers, but there is little doubt that it will fall rapidly next year,” he totaled.

The euro dropped slightly against the British pound, trading at £0.863, and rose about 0.4 percentage instants against the U.S. dollar at $1.037 shortly after the figures were released.

The easing in inflation comes after a like set of data out of the United States. Earlier this month, the October consumer price index came in below wants.

Earlier this month, an ECB member told CNBC that peak inflation was “within reach.” Edward Scicluna, who’s also the governor of the Bank of Malta, determined CNBC exclusively that as a result he didn’t see a repeat of the previous rate hike of 75 basis points.

Exchange expectations point to an increase of 50 basis points in rates in December.

Lower inflation figures could be a substantiation of recent increases in interest rates and could mean smaller, or less, rate hikes in the coming months. Regardless how, speaking earlier this week, ECB President Lagarde predicted further changes to its benchmark rate.

“We expect to round up rates further to the levels needed to ensure that inflation returns to our 2% medium-term target in a timely method,” she told European lawmakers.

The central bank has raised rates three times this year and it is expected to do so again in December. On the other hand, there is a huge uncertainty as to how many rate hikes the ECB will announce next year.