Germany followed Spain and Belgium in reporting slowing inflation, and offered support to those calling on the European Central Bank to ease the pace of interest rate increases.
Germany’s statistics office said on Tuesday that consumer prices in Europe’s largest economy rose 11.3% in November year-on-year, down from October’s 11.6% jump, citing factors including lower energy costs.
In Spain, it has abated inflation For the fourth month and more than expected, propelled by lower electricity and fuel costs, although the underlying price gauge accelerated. Meanwhile, the headline figure in Belgium slowed to 10.6%.
Inflation data for the 19-country eurozone is due out on Wednesday, with economists also expecting slight moderation…the first in a year and a half.
This reading will be crucial as ECB officials consider a third consecutive 75 basis point hike in borrowing costs or a smaller half point move ahead of a potential recession.
Declining inflation may prompt officials to focus more on the underlying metric in determining whether a tipping point has been reached.