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We finalize today our eurozone inflation forecasts for November. Next Friday, with the German data already available, we will refine our call, if needed.
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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.
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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%.
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In December, the energy base effect will weigh heavily again and push the inflation rate to 1%.
Euro Inflation Update
In November, the eurozone inflation rate will turn again positive
Fri, Nov 20 2009, 11:26 GMT
by
UniCredit Research
- UniCredit Group
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