Consumer prices jumped by a fresh record of 10.7 percent in October, stoked by an eye-watering 41.9 percent rise in energy costs, Eurostat said.
The news came after the European Central Bank warned last week that a recession was looming, as it announced another jumbo interest rate hike to try to curb inflation driven up by the fallout from energy producer Russia’s war on Ukraine. “Double-digit inflation and decade-high interest rates do not bode well for eurozone growth during the rest of this year and into 2023,” noted economist Benjamin Trevis at think-tank CEBR. Asia mainly advanced, although Hong Kong and Shanghai sank on concerns over the economic impact of Chinese Covid restrictions.
Beijing reported a contraction in factory activity Monday as sweeping pandemic restrictions paralysed major industrial cities.
That also weighed heavily on oil because China is a major global consumer. “Although these data points are weaker than expected, it should be no surprise given those broad-based Covid-related restrictions that remained in place during the party congress,” said Stephen Innes, managing partner at SPI Asset Management. “Negative news from the real estate sector is adding salt to the economic wounds.”