Eurozone inflation slowed slightly in October, though underlying price pressures remained sticky. According to the flash estimate, headline CPI edged down to 2.1% yoy from 2.2%, in line with expectations. Core inflation, which excludes energy, food, alcohol and tobacco, held steady at 2.4%, surprising on the upside compared with forecasts of 2.3%.
A closer look at the breakdown shows services inflation rose to 3.4% from 3.2%, confirming that the most persistent source of price pressure continues to come from the labor-intensive service sector. Meanwhile, food, alcohol and tobacco inflation eased to 2.5%, non-energy industrial goods slowed to 0.6%, and energy prices fell -1.0%, marking a deeper decline than September’s -0.4%.
