Eurozone Inflation Grew Close to 6-year High Due to Energy Prices

The eurozone inflation grew in October at the quickest rate in almost six years boosted by energy costs based on the reports on the earlier estimate of the European Union statistics agency on Friday.

The core inflation, excluding food and energy, was reduced.

According to the Eurostat, consumer prices in the euro bloc consisting 19 nations contributed to the increase of 2.2 percent year-on-year in October following a 2.1 increase in September and 2.0 percent in August, which was the highest growth since December of 2012.

Headlines support the decision of the ECB end the bond-buying program by the end of the year as the inflation exceeded the target price growth but closer to the 2 percent in the medium-term.

However, the inflation as the core indicator of the ECB, excluding volatile products or energy and unprocessed food, was changed lower to 1.2 percent on the year compared to the former estimate of 1.3 percent by the Eurostat. Yet, rates are still rising at a quicker pace compared to the 1.1 percent hike in September.

The headline inflation rose by 0.2 percent in October which still follows the market expectations but slowed down from 0.5 percent in September.

The least core indicator monitored by market investors but excluding food, tobacco, alcohol, and energy was confirmed to be 1.1 percent on the year.

Increase in the headline inflation was predominantly due to higher energy prices as it grew to 10.7 percent year-on-year in October while Industrial good prices rose by only 0.4 percent.

Meanwhile, in the services sector as the biggest part of the eurozone economy, the inflation was recorded to be at 1.5 percent on the year but prices declined by 0.3 percent on the month.