The vice president of the european central bank stated that inflation in europe is moving in the right direction.

On Thursday, November 14, vice president Luis de Guindos of the european central bank said that the CPI data for the eurozone in October undoubtedly encouraged the policymakers of the european central bank, but economic growth remains suboptimal. Guindos said:

"There is good news regarding inflation, but economic growth is less than ideal. We expect inflation in the services sector to slow down in the coming months, and our expectation for inflation trends is that it will approach price stability in a clear and stable manner, reaching the 2% target."

In October, the harmonized CPI in the eurozone increased by 2% year-on-year, with service prices increasing by 3.9%, driven mainly by wage increases. In the third quarter, the GDP of the eurozone grew by 0.4% quarter-on-quarter and 0.9% year-on-year, which, although higher than expected, cannot be considered outstanding.

Since June, the european central bank has implemented three interest rate cuts totaling 75 basis points. The market generally expects that the european central bank will lower rates again in December.

However, Guindos' remarks continue the consistent standard of european central bank officials, stating:

"The evolution of monetary policy will depend on the inflation situation; the strength of the economic recovery has not reached the level we expected. Household income has recovered somewhat, but this recovery has not translated into consumer growth."

Last week, Trump won the usa election, which further impacted the economic outlook of europe, as Trump might reinstate tariff policies after returning to the White House.

In response, Guindos stated that although the actual measures of the Trump administration are still unclear, trade protectionism will ultimately lead to supply shocks and restrict economic growth.

Editor/ping