Euro zone inflation, October 2024
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Line-up of pumpkins in the Netherlands, on Oct. 27, 2024.

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Inflation in the 20-nation euro zone rose to 2% in October, preliminary figures released by statistics agency Eurostat showed Thursday.

Economists polled by Reuters had forecast a headline figure of 1.9%. The September headline reading was revised down to 1.7% from 1.8% on Oct. 17, below market expectations.

The biggest upward pull in the headline rate came from food, alcohol and tobacco, where price rises accelerated to 2.9% from 2.4%.

Core inflation, which excludes those volatile components along with energy prices, was unchanged at 2.7%, slightly higher than the 2.6% expected. Services inflation — an important gauge of domestic price pressures — also held steady at 3.9%.

The euro was up 0.15% against the U.S. dollarfollowing the release, trading at a two-week high of $1.087.

The fresh Thursday inflation print is seen as crucial in judging whether the European Central Bank could consider implementing a jumbo half-percentage-point cut in interest rates at its next meeting in December.

The central bank has so far trimmed rates three times this year, making quarter-point increments that altogether took the central bank’s key rate from 4% to 3.25%.

Markets are currently pricing another 25-basis-point reduction in December.

Euro zone growth