The eurozone’s inflation has risen to its highest point since 1999, when the single currency was launched. This puts more pressure on the European Central Bank for action ahead of next month’s meeting.
In November, consumer prices rose by 4.9 percent on an annual basis. This was higher than the forecasts of 4.5 percent. Another record-breaking figure, which excludes volatile components like food and energy, also reached 4.9pc in November.
This comes after Germany reported an inflation rate of 6 % this month, the highest since the early 1990s. Meanwhile, prices in France rose at the fastest pace for more than a decade.
The ECB has resisted the calls to tighten monetary policy and insists that the current spike of inflation is temporary.
Although President Christine Lagarde insists on the same script, officials warn that price pressures may take longer to subside.
On 16 December, the central bank will meet to announce that it’s pandemic bond-buying plan has ended. It will also outline how regular purchases of interest rates and other financial policies will continue.
French inflation reaches a 10-year high
Inflation in France accelerated in November at the fastest pace it has been in over a decade, as rising energy costs outweighed a drop in fresh food prices.
The eurozone’s second-largest economy saw inflation of 3.4 percent this morning. This is higher than economists expected and represents the sharpest increase in annual inflation since 2008.
This comes just six months after Germany posted a 6.4% increase in its price index. It was the highest level in over three decades.
These numbers will increase pressure on the ECB. They are reluctant to raise interest rates because the spike in inflation was temporary.
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