Wed, 26 Jan 2022

Eurozone's inflation hit record high in November

01 Dec 2021, 05:49 GMT+10

BRUSSELS, Nov. 30 (Xinhua) -- The inflation rate in the eurozone hit a record high in November, mainly due to rising energy prices, Eurostat said on Tuesday.

The EU statistical office said that at a rate of 4.9 percent, it was the fastest year-on-year increase seen since records began for the 19-country currency area in 1997. October's inflation was already high at 4.1 percent.

According to Eurostat, consumer prices were once again propelled by the surge in the cost of energy which is expected to have the highest annual rate in November -- 27.4 percent compared with 23.7 percent in October.

France suffered a 3.4 percent rise in inflation, but it was in Germany, among the bloc's largest economies, where prices soared, pushing the rate of inflation to 6 percent.

According to ING expert Bert Colijn, inflation will "undoubtedly drop again over the course of next year," but "we don't expect inflation to drop much below 2 percent for late 2022."

"While second-round effects are largely absent for now, medium-term price pressures are increasing and we expect wage growth to rebound over the course of next year," said Colijn.

Maeva Cousin, an economist covering the euro area for Bloomberg Economics, said that while energy costs and statistical effects "can explain the bulk of this month's jump, today's reading also revealed some stronger than anticipated underlying pressure."

"That will add to concern over upside risks to the outlook, but the European Central Bank is still likely to see inflation falling below 2 percent by the end of next year."

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