EU Inflation Drops to Nearly 2-Year in September

Eurozone inflation just published at 4.3% YoY, the 2-year low since October 2021. The slowdown of EU inflation is reinforcing many indices to reverse from bearish sentiment since last night.

The UK consumer credit growth data in August was at 2018-high, by £1.644 billion, compared to an upwardly revised £1.271 billion increase in July. The effect from last night US GDP data and the FED chair Powell statement also helped pushing up Eurozone indices as well.


Core inflation, which excludes energy, food, alcohol and tobacco, also dropped to 4.5% YoY from 5.3% in August.

The reading comes after the European Central Bank raised interest rates to a record level in September to 4%.


Euro currency climbed over $1.06 per euro after the EU CPI report. The currency had been rising since the fourth quarter of last year at $0.97 per euro, to the latest peak at almost $1.13 per euro in July. After that, the euro had been falling ever since as EU economic data became bearish in recent months.

European stocks also extended their gain with Euro STOXX 600 gaining 0.9% to 453, and Frankfurt’s DAX 40 also gained 0.9% over 15,400. Both indices have been losing over 1% this month.

Meanwhile the German 10-year Bund yield retreated from its 12-year high at 3% to 2.85%, along with US 10-year treasury yield from the latest auction at 4.68% to now 4.5%.