Eurozone Inflation Softens On Energy Prices

(RTTNews) - Eurozone inflation softened in October largely due to the fall in energy prices, while core consumer prices registered a steady growth, official data revealed Friday.

The harmonized index of consumer prices rose 2.1 percent on a yearly basis, following a 2.2 percent rise in September, flash estimate from Eurostat showed. Inflation came in line with expectations. Core inflation that excludes energy, food, alcohol and tobacco held steady at 2.4 percent in October. The core rate was forecast to slow to 2.3 percent.

Month-on-month, the HICP rose 0.2 percent in October and core prices gained 0.3 percent in October.

Among components of HICP, only services inflation accelerated in October, to 3.4 percent from 3.2 percent. Meanwhile, food, alcohol and tobacco grew at a slower pace of 2.5 percent, following a 3.0 percent rise in September. Likewise, non-energy industrial goods prices registered a 0.6 percent rise after climbing 0.8 percent in the previous month. The decline in energy prices deepened to 1.0 percent from 0.4 percent.

Data came a day after the European Central Bank kept its key interest rates unchanged for a third straight session on Thursday. The deposit rate was retained at 2.00 percent. The last reduction was a quarter-point cut in June.

ECB Chief Christine Lagarde repeatedly said that the bank is in "the good place". She said the bank will do whatever is needed to make sure that it remains in the good place.

ING economist Bert Colijn said inflation is expected to ease further in the months ahead but not much below the 2 percent mark.