Inflation in Germany retreated more than predicted by economists in November on easing energy and travel costs, putting the inflation rate in Europe’s largest economy within reach of the European Central Bank’s two per cent target.
According to the German statistics agency Destatis, inflation, as measured by the consumer price index (CPI) saw an annual increase of 3.2 per cent in November, down from October’s 3.8 per cent rise and lower than expectations of 3.5 per cent. Inflation was negative on a month-on-month basis, with consumer prices falling by 0.4 per cent. On the other hand, core inflation, which excludes prices of volatile items like food and energy – and is more closely watched by ECB policymakers as an indicator of underlying price trends – fell substantially to 3.8 per cent in November, from October’s 4.3 per cent, according to Destatis.
Meanwhile, Britain’s housing market is signalling that the downturn is stabilising as UK mortgage approvals increased more than expected to a three-month high in October, after the Bank of England kept interest rates steady in its September and November monetary policy meetings.
Net mortgage approvals for house purchases in the UK rose to 47,400 in October from 43,700 in September, the latest BoE data showed on Tuesday. The October figure was well in excess of economists’ expectations of 45,000 and the highest since July of this year.
Inflation [in Germany] was negative on a month-on-month basis, with consumer prices falling by 0.4%
“With approvals for house purchases – an indicator of future borrowing – picking up in October after September’s dip, it is clear that the pause in interest rate hikes has boosted market stability and buyer confidence,” Jason Tebb, chief executive officer of property platform OnTheMarket.com, said.
Finally, American consumers shrugged off high interest rates and spent enough to help grow the economy at a brisk 5.2 per cent annual pace during the period July through September, the government said in an upgrade to the previous estimate.
The US economy grew by 5.2 per cent in the third quarter, higher than previous estimates of 4.9 per cent. Consumer spending, a vital part of the economy, increased at a 3.6 per cent annual rate during the review period – still healthy but a slightly slower pace than the previous estimate of four per cent.
Private investment surged at a 10.5 per cent annual rate, including a 6.2 per cent increase in housing investment, as house buyers defied higher mortgage rates.
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