By Joshua Kirby
Eurozone prices rose at a slower pace in September than in August, confirming initial estimates.
The bloc’s consumer price index increased 4.3% compared with the same month a year earlier, slowing from 5.2% in August, according to figures published Wednesday by European Union statistics body Eurostat. This confirmed previous estimates and matched economists’ expectations.
Core prices, stripping out food, alcohol, tobacco and energy, rose 4.5% on year, with services the largest contributor to price rises. Energy prices meanwhile decreased compared with the same time last year.
Inflation rates diverged sharply across the 20-member currency union. The Netherlands booked slightly lower prices on year, according to Eurostat’s figures, while Spain recorded inflation of 3.3%. France and Italy meanwhile booked price rises ahead of the average, at 5.7% and 5.6%, respectively, while Hungary saw prices surge more than 12%.
Slower overall inflation could persuade the European Central Bank to leave interest rates where they are, ending a long cycle of rate hikes. Last month’s increase to a deposit rate of 4.00% was likely the last in the cycle, strategist Jussi Hiljanen and economist Marcus Widen at SEB Research said in a note. However, a decrease in rates may not come until the latter part of next year, especially if inflation eases less rapidly in the first months of 2024, they noted.
Write to Joshua Kirby at [email protected]; @joshualeokirby
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