Eurozone inflation rose to 4.0% in October, its highest level in three years, driven by surging energy prices, according to a flash estimate released on Wednesday 4 November. This is a catch-up report on that release, not news from 5 November.

The figure, published by Eurostat, was up from 3.8% in September and in line with the 4.0% expected by economists polled by Reuters. It was the highest reading since September 2023, when inflation stood at 4.3%, and the fourth straight monthly increase. Core inflation, which strips out energy and food, held steady at 2.5%.

Energy drives the rise

Energy prices rose 20.8% year on year, the fastest since December 2022, while services inflation edged up to 3.3% from 3.2% and food, alcohol and tobacco prices rose 1.6% from 1.3%. Among the big economies, Italy's inflation jumped to 5.6% from 4.2% and France's rose to 3.8% from 3.4%, while Germany's eased to 2.8% from 3.3%, partly on a temporary fuel tax cut. Spain's rate slipped slightly to 4.9% from 5.0%.

The European Central Bank held its deposit rate at 2.5% on 29 October and expects inflation to stay above 4% for much of the first half of 2027 before falling back towards the low twos. Markets have raised their bets on a December rate rise after the release, though estimates of the odds differ by source. The final October figures are due on 18 November.

Sources: Reuters, Euro zone inflation rises to three-year high, 4 November 2026; Dow Jones via Morningstar, Eurozone inflation rises to 4%, driven by energy costs, 4 November 2026; TradingEconomics via TradingView, Eurozone inflation hits fresh three-year high, 4 November 2026.