Europe’s inflation eased to 2.9% in October thanks to lower fuel prices. But growth has vanished

BY DAVID MCHUGH

FRANKFURT, Germany (AP) — The inflation that has been wearing on European consumers fell sharply to 2.9% in October, its lowest in more than two years as fuel prices fell and rapid interest rate hikes from the European Central Bank took hold.

But that encouraging news was balanced by official figures showing economic output in the 20 countries that use the euro shrank by 0.1% in the July-September quarter.

Inflation fell from an annual 4.3% in September as fuel prices fell by 11.1% and painful food inflation slowed, to 7.5%.

The drop to under 3% is down from the peak of over 10% in October 2022 and puts the inflation figure at least within shouting distance of the European Central Bank’s target of 2% considered best for the economy. It was the lowest reading since July, 2021.

But growth disappeared as output shrank after months of stagnation