Nov. 30 (UPI) — Inflation in the eurozone dropped for the first time in 17 months in a needed breather for consumers within the group of nations despite it still rising double digits at 10% in November, according to European Union’s Eurostat.
The new data comes after Eurozone inflation reached a record 10.6% in October. The bad news is that the new total is still well above the inflation rate of 4.9% reported at this point in 2021.
Energy cost remains elevated, with an increase of 34.9% from last year, the sector was the biggest driver of the inflation decrease, falling from the 41.5% rate last month. Non-energy industrial goods remained steady at 6.1% while services fell slightly from 4.3% in October to 4.2% in the new report.
The inflation number for food, alcohol and tobacco products, though, increased 13.6% in November, compared to 13.1% in October.
“While inflation should remain elevated, the fact that energy is set to become more disinflationary means that today’s data will very likely be followed by a gradual decrease in inflation for the eurozone,” Oxford Economics economist Nicola Nobile said.
Inflation also increased with some of the Eurozone’s strongest economies, including Germany, which fell from 11.6% in October to 11.3% in November, Spain from 7.3% to 6.6%, and Italy from 12.6% to 12.5%. Inflation in France, though, remained even at 7.1% over the past month.
Inflation pains for the eurozone may not be over, according to European Central Bank President Christine Lagarde, who said earlier this week that she “would be surprised” if eurozone inflation had peaked because of wholesale energy prices still being passed on to consumers.
