Euro In the region, CPI (Consumer Price Index) decreased to 2.4% in November, decreasing by 0.5% from 2.9% in October. Economists had expected a reading of 2.7%, according to a Reuters poll. Core inflation, which excludes the volatile food and energy sectors, also fell below expectations, falling to 3.6%.
Although the CPI remained calmer in the Eurozone, European Central Bank officials stated that it may be too early to reduce interest rates. Authorities will first monitor the possibility of pressure from rising wages and energy markets.
Headline inflation in the euro area has fallen significantly from its peak of 10.6% in October 2022. According to Bert Colijn, a senior eurozone economist at ING, ‘stagnant demand’ could keep inflation at bay.
Although inflation has fallen to new lows, Europeans continue to feel the pinch of rising costs. According to Euro News, Yacin Malkoc, a Belgian grocery manager, said: “There has been an increase of approximately 30% in fruits and vegetables, especially strong products such as bananas, mushrooms or tomatoes.” He attracted attention with his comment.
Food prices in Europe continued to increase throughout 2023. However, price increases have been less frequent in recent months.
European Commissioner Paolo Gentiloni said: ‘According to our estimates, the increase in wages will catch up with inflation. This, of course, will contribute to purchasing power, increase consumption, and the increase in consumption will be the premise of restarting growth. So there is some moderate optimism as we look to 2024.
Inflation in most major economies has fallen in the last few months. In the UK, CPI fell to 4.6%, the lowest level of the last two years, and in the USA, to 3.2%. However, both countries have not yet achieved their CPI target.