Eurozone flash HICP grows faster by 4% YoY in October, as expected

Sagar Dua FXStreet

Eurozone’s preliminary Harmonized Index of Consumer Prices (HICP) data for October arrives at 4% Year-on-Year (YoY), as expected, higher than September’s final reading of 3.8%. On a monthly basis, inflationary pressures grew at a moderate pace of 0.4% against the prior release of 0.6%.

The core HICP – which excludes volatile components like food, energy, alcohol, and tobacco – rises in line with estimates and the previous reading of 2.5%. Month-on-month core HICP rose at a faster pace of 0.3% vs. 0.2% in September.

Market reaction

No immediate impact is seen in the Euro (EUR), following the release of the Eurozone HICP data. As of writing, EUR/USD trades 0.6% higher to near 1.1260 due to sheer weakness in the US Dollar (USD).

Economic Indicator

Harmonized Index of Consumer Prices (YoY)

The Harmonized Index of Consumer Prices (HICP) measures changes in the prices of a representative basket of goods and services in the European Monetary Union. The HICP, released by Eurostat on a monthly basis, is harmonized because the same methodology is used across all member states and their contribution is weighted. The YoY reading compares prices in the reference month to a year earlier. Generally, a high reading is seen as bullish for the Euro (EUR), while a low reading is seen as bearish.

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