Fri, Nov 20 2009, 11:26 GMT
by UniCredit Research
We finalize today our eurozone inflation forecasts for November. Next Friday, with the German data already available, we will refine our call, if needed.
In November, the eurozone inflation rate will turn again positive. We confirm our estimate of +0.5% yoy (+0.4% yoy on the extobacco index), and see broadly balanced risks to this forecast. The flash estimate is due on November 30.
The rise in the inflation rate will be entirely an energy story. We think energy prices will be up around 1.5% mom, but the yearly rate should jump 6pp due to a markedly unfavorable base effect: this will lift overall inflation by 0.6pp. Food inflation probably bottomed out already in October, while core inflation could ease by 0.1pp to 1.1%.
In December, the energy base effect will weigh heavily again and push the inflation rate to 1%.
Published on Fri, Nov 20 2009, 11:26 GMT
UniCredit Group
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http://www.unicreditmib.eu/ | communication@unicreditgroup.eu
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