Friday’s data showed that inflation in France unexpectedly slowed for the second consecutive month in September, deviating from the trend in its neighbor Germany and the broader euro zone, supported by a slowdown in the rise in energy and services prices.
France’s annual inflation rate fell to 6.2 percent in September from 6.6 percent a month earlier, the National Institute of Statistics said, contradicting the median forecast of economists in a Archyde.com poll for a slight acceleration to 6.7 percent.
Inflation peaked in July at 6.8 percent in the eurozone’s second-largest economy, which is doing better than its neighbors in taming price hikes, despite some economists warning that France’s massive spending on comprehensive family protection programs does not solve the problem.
“Low inflation in September is certainly good news, although it is too early to declare victory, as pressure in the energy sector is expected to intensify in the coming months,” said Diego Escaro, chief economist at Standard & Poor’s Market Intelligence.
Data published on Friday showed that inflation in the euro zone exceeded expectations and reached a new record high of 10 percent in September, reinforcing expectations of another massive interest rate hike by the European Central Bank in October.
German inflation reached 10.9 percent in September, the highest level in more than a quarter of a century, while consumer prices in the Netherlands jumped 17 percent, the highest level in decades, due to the sharp increase in energy prices.
A detailed look at the French data shows that the decline in the headline inflation rate is primarily due to weak energy price inflation, which hit a one-year low of 17.9 percent.
On the other hand, France’s National Institute of Statistics said Friday that consumer spending was unchanged in August following declining in July.
(Archyde.com)
Tag:
Euro-zone
A slowing economy in the eurozone increases the possibility of a recession
written by Alexandra Hartman Editor-in-Chief
A closely-watched survey by economists showed on Friday that European economic activity fell once more in September, raising expectations of a recession.
“The economic slowdown deepened in the eurozone in September, with business activity contracting for the third consecutive month, albeit modest, but the rate of decline accelerated to the most severe pace,” Standard & Poor’s Global Flash said. Since 2013, excluding pandemic lockdowns.
The Purchasing Managers’ Index fell from 48.9 in August to 48.2 in September – noting that it represents below the 50 economic contraction threshold.
“The stagnation in the eurozone is there,” said Chris Williamson, chief business economist at Standard & Poor’s Global Market Intelligence. Firms report deteriorating business conditions and increased price pressures linked to higher energy costs.
He added, “Germany is facing the most difficult conditions, with the economy deteriorating at a rate that we have not seen, except for the pandemic period, since the global financial crisis.”
The skyrocketing energy prices and the sharp rises in the cost of living have dampened demand and reduced manufacturing output. Eurozone inflation rose to 9.1% in August, its highest level ever, while analysts expect the rate to reach double digits by the end of the year.
The European Central Bank raised interest rates by a record 75 basis points this month and pledged to do everything in its power to limit the rise in consumer prices.
Williamson said that indicators point to a contraction of the euro area by 0.1% in the third quarter of 2022 and a sharp decline in the fourth quarter, noting that the challenge faced by policy makers in curbing inflation while avoiding a sharp decline in the economy is therefore becoming increasingly difficult.
(AFP)
Hassouna Al Tayeb (Abu Dhabi)
Many economists expect inflation rates in the euro area to exceed 10% next autumn, and to continue for the longest period, as a result of the rise in gas prices, in addition to the possibility of the region entering a recession during the year 2023.
This would add more pressure on the European Central Bank, to take into account a significant increase in interest rates, regardless of the warnings of observers, of the repercussions of this and its negative impact on consumer activity.
growth and jobs
In one of the meetings held during the last week of August in Wyoming, the decision makers of the European Central stressed the need to make greater sacrifices, in terms of the loss of growth and jobs, in order to control inflation once once more.
The price of gas in Europe at the end of last August reached a record of 343 euros per megawatt hour, which is more than double the prices of the end of last July, and regarding 7 times, during the same period in 2021. The decline in Russian gas flows increased fears of shortage, to become involved The European Union is preparing measures to prevent further price hikes.
Many analysts expect the annual change in consumer prices to increase by more than 10% in October, compared to the record numbers recorded by these prices last July at 8.9%.
Recession and inflation
Some experts also believe that the significant rise in gas prices will seriously harm the European economies, in addition to the fact that the high prices for the consumer and the cost for companies, exacerbates the recession and inflation. They believe that the inflation rate will exceed 4% during the year 2023. Economists’ expectations are accompanied by some pessimism regarding the gross domestic product of the eurozone in 2023, with growth declining by 50% to an estimated rate of less than 1%, compared to last June.
The wholesale price of 200 euros per megawatt-hour adds between 7 and 8% to inflation in Germany. Long-term gas contracts, delays in price hikes, and some costs being absorbed by the business help ease additional pressures. In the wake of the tourism sector boosting the growth of the region’s countries during the current summer season, GDP is likely to decline, until the spring of 2023, with a decline in private sector consumption, business sector investment and exports. It is also expected that the effects of the rise in gas prices on the growth of the Eurozone will continue for quite some time.
Economic activities affected
It may be difficult for the eurozone to return to pre-Covid-19 growth levels, given the continued loss of competition, which in turn leads to a loss of some activity, especially in sectors such as metals and chemicals.
The five-year swap rate, the benchmark that measures inflation every five years, has been elevated in the eurozone over the past few weeks.
Citibank’s expectations indicate that the inflation rate in the euro area will reach 10.3% during the autumn, in addition to the contribution of high energy prices and the depreciation of the euro below the value of the dollar, to further rise in consumer prices.
World Central Bank stocks more gold Prevent Inflation Pressures Currency I TNN Money Hours I 01-09-65
written by Alexandra Hartman Editor-in-Chief
World Central Bank stocks more gold Prevent Inflation Pressures – Currency, the latest data from the World Gold Council. indicates that central banks around the world Still moving forward, gold reserves have increased in the past half year. and in the next phase Even the gold price trend seems to be down. But the opportunity to collect gold into the port is still high This is reflected in the survey findings that there is no central bank at all. that plans to reduce gold reserves in the next 12 months #World Central Bank #Inflation #Currency #Gold #Central Bank #World Gold Council . Every Monday-Friday time 09.30-10.30 on TNN Channel 16 Channel to follow the news station TNN Channel 16 https://www.tnnthailand.com https://tv.trueid.net/live/tnn16 https://www. .youtube.com/c/tnn16 https://www.facebook.com/TNNthailand/ https://www.facebook.com/TNN16LIVE/ https://twitter.com/tnnthailand https://www.instagram.com /tnn_online/ https://www.tiktok.com/@tnnonline Line @TNNONLINE or click https://lin.ee/4fP2tltIo Keep up with the world, keep up with the economy, keep up with all the truth with TNN Channel 16, a news station that holds the principles of news presentation. Straight to the point, fast, accurate, accurate and impartial by a professional news team.