Fuel drives up euro zone inflation

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Fuel drives up euro zone inflation

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Annual inflation in the euro zone hit 1.9 percent in October.

The EU’s statistics office Eurostat said compared with September inflation rose 0.4 percent.

The annual rate was pushed higher by fuel prices, which in October were 0.6 percent up on September.

However in Ireland there was deflation, with consumer prices having fallen by 0.8 percent from October last year.

In Britain inflation unexpectedly rose further above its the Bank of England’s target in October, but the UK central bank said it was ready to change policy in either direction as the risks to the outlook were substantial on both sides.

The Office for National Statistics said that annual consumer price inflation rose to 3.2 percent last month, more than a percentage point above the bank’s two percent target.

It has now exceeded three percent every month since March.

Analysts had expected it to stay at 3.1 percent and the pound shot up around half a cent against the dollar as traders bet the stubbornly high inflation figures meant the BoE’s Monetary Policy Committee will not pump more stimulus into the economy.