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Country data so far available in October suggest a low risk of revision to the eurozone flash estimate (-0.1% yoy). The final release will be out on November 16: we have penciled in a 0.25pp boost to the headline rate coming from energy, while food inflation probably eased a bit further and core inflation was unchanged at 1.2% yoy.
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In November, the eurozone inflation rate will rise strongly and exit negative territory. Once again, energy will be the main driver, with the price of oil products up strongly on a monthly basis and the base effect turning even more unfavorable. We confirm our preliminary estimate of +0.5% yoy on the headline (with upside risks). 2009 should close with inflation at 1% yoy.
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In a medium-term perspective, we note that the lack of pressures on food inflation continues to counterbalance rising energy prices. The last set of data for PPI and selling price expectations at food producing companies still suggests benign retail food prices at least over the next three-six months.
Euro Inflation Update
The eurozone inflation rate will rise strongly and exit negative territory
Fri, Nov 6 2009, 12:34 GMT
by
UniCredit Research
- UniCredit Group
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