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Eurozone economic growth still slow as inflation picks up slightly


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Eurozone economic growth still slow as inflation picks up slightly

There was no change in eurozone economic growth between July and September – it was at the same slow pace as in the previous quarter.

Gross domestic product in the 19 countries using the euro rose 0.3 percent quarter-on-quarter.

It was up by 1.6 percent from the same period last year.

Economists said the numbers reflected the European Central Bank’s stimulus efforts to revive the region’s economy.

There were few signs of a negative impact from the June referendum vote for Britain to leave the European Union.

The ECB will also be looking closely at the latest inflation figures which were released at the same time.

It is estimated consumer prices rose by 0.5 percent in October compared with the same month last year.

That was up from September’s 0.4 percent and August’s 0.2 percent.

Higher energy prices were a big factor.

However core inflation – which excludes the most volatile prices for unprocessed food and energy – was just 0.7 percent year-on-year, down from 0.8 percent in the previous five months.

The European Central Bank would like a greater rate of overall inflation – close to two percent in the medium term.

It has been pumping money into the eurozone economy by buying government bonds to try to beef it up.

That bond buying programme is due last until March 2017 and ECB policymakers have to decide in December how much longer they will continue to do that.

Howard Archer, chief European economist at IHS Markit said it was conceivable that the ECB could announce a lower rate of purchases after March.

“Even if eurozone growth does show further signs of improvement over the coming weeks, there is a compelling case to try and fuel the improvement given past hiccups,” he said.

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