Inflation across the European Union (EU) rose to an annualized 2% in October, according to preliminary data from statistics agency Eurostat.
The October inflation reading was above the 1.9% expected among economists polled by the Reuters news agency.
However, the September inflation rate in Europe was revised down to an annualized rate of 1.7% from an initial reading of 1.8%.
Exerting the biggest upward pressure on October’s inflation rate was food, alcohol and tobacco, where prices increased by 2.9% year-over-year.
Core inflation, which excludes volatile food and energy prices, remained unchanged in October at 2.7%, slightly higher than the 2.6% expected among economists.
The latest inflation reading is seen as quashing plans by the European Central Bank (ECB) to lower interest rates by 50-basis points at its next meeting in December.
Futures markets are now betting on a 25-basis point rate reduction in December.
The central bank has lowered interest rates three times so far this year, taking its key policy rate down to 3.25% from 4%.
The latest gross domestic product (GDP) data showed better-than-expected growth across Europe, with the economic zone expanding a better-than-expected 0.4% in the third quarter.
The European Central Bank targets inflation at a 2% annualized rate, or the midpoint of a 1% to 3% range.
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