Eurozone inflation confirmed at 0.5% in October

Inflation in the euro area was 0.5% on the year in October, up from 0.4% the month before, Eurostat confirmed on Thursday.

On the month, consumer prices were up 0.2% last month in the 19 countries that share the euro.

The largest upward impacts to annual inflation came from restaurants and cafes, which added 0.07 percentage points and rent and tobacco, which added 0.04 pp. Gas, vegetables, milk, cheese and eggs had the biggest downward impacts.

In the EU-28 group of nations, annual inflation was 0.5%% in October, up from 0.4% in September

Dennis de Jong, managing director at UFX.com, said: “Although inflation remains some way below the ECB’s two per cent target, it is still fairly solid which will give ECB President Mario Draghi means for encouragement.

“He will know that there is no time to stop and smell the roses, however. Donald Trump’s surprise election victory following on from Brexit means we are now in the midst of one of the most uncertain economic periods in recent memory.

“While there are a number of positive signs within the currency bloc, the ECB has a number of tough decisions to make over the coming months, not least whether to extend its bond purchasing scheme beyond March 2017.”