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POST TIME: 1 November, 2019 00:00 00 AM
Eurozone faces stagnation, as inflation falls again
AFP, Brussels

Eurozone faces stagnation, as inflation falls again

Economic growth in the eurozone remained at a weak 0.2 per cent in the third quarter and inflation fell in October, underlining the risk of stagnation in the 19-nation single-currency bloc. According to official Eurostat figures published yesterday, inflation fell from 0.8 per cent in September to 0.7 per cent in October, well below the European Central Bank’s target rate of just under two per cent.

The fall was in line with the predictions of analysts surveyed by financial services firm Factset, but nevertheless was the lowest rate since November 2016. The 0.2 per cent growth rate was better than a predicted 0.1 per cent, but has now remained at an anaemic 0.2 per cent for three quarters in a row, underlining the eurozone’s plight amid global uncertainty.

Growth has been hurt by trade disputes and by the ongoing saga of Brexit, which have generated uncertainty for the eurozone’s great export power Germany, whose manufacturing sector is entering recession. “The months ahead are likely to remain tricky for the eurozone,” Bert Colijn, senior eurozone economist for the bank ING, said in an analyst’s note.