Inflation eases in Europe – but remains in double digits

Inflation in the 19 countries using the euro currency has eased to 10% this month as fuel and utilities drifted down from painful highs.

However, the rate remains near the record levels that have robbed consumers of spending power and led economists to predict a recession.

The consumer price index was down from 10.6% in October, the European Union statistics agency Eurostat said.

That is the first decrease since June 2021. But the double-digit figure reflected prices for food, alcohol and tobacco rising faster, at a pace of 13.6% annually.

Energy prices slipped to a 34.9% rate of increase, down from the astronomical 41.5% in October.

Out-of-control inflation is being fed by high energy prices caused by Russia cutting off natural gas over the war in Ukraine as well as bottlenecks in supplies of raw materials and parts and rebounding demand after the removal of Covid-19 pandemic restrictions.

Inflation has hit other economies but has taken a particularly high toll in Europe because of its dependence on Russian natural gas, which exporter Gazprom has reduced to a trickle.

European leaders say this is energy warfare due to Europe’s support for Ukraine.