Analysts at Danske Bank suggest that today’s main event is the euro area flash HICP and the inflation number is particularly interesting given that euro area growth slowed to a four-year low yesterday and Draghi’s insistence on inflationary pressure last week.
Key Quotes
“Ergo stagflation. Since April, headline inflation has been close to the ECB’s target (below but close to 2%). We expect the October numbers to increase slightly to 2.2% y/y driven by higher energy prices and much more importantly, higher core inflation. We expect a pickup in core inflation to from 0.91% to 1.09% on the back of higher service price inflation.”
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