Inflation in the Euro Area rose to 2.0% in October, up from 1.7% in September, marking the first increase in three months, according to the latest data from Eurostat.
- The uptick was driven by a 0.3% rise in prices, the largest monthly gain since April, reversing the 0.1% drop in September.
Drivers: Services were the biggest driver of the annual inflation rate, contributing +1.77 percentage points (pp), followed by food, alcohol, and tobacco (+0.56 pp). Non-energy industrial goods added a modest +0.13 pp.
- Energy prices fell 4.6% year-on-year, continuing their three-month streak in negative territory.
Where: Inflation varied widely across the bloc. Slovenia saw no inflation (0.0%), with Lithuania and Ireland at just 0.1%. Meanwhile, Romania topped the chart at 5.0%, followed by Belgium and Estonia at 4.5%.
Bottom Line: Inflation may rise in a straight line, but it rarely falls that way. The Euro Area’s October increase highlights persistent pressures, particularly in services, even as energy prices provide some relief.
