The 12 month eurozone inflation rate surged to 2.6 percent in October from 2.1 percent in September. Meanwhile, inflation in the 27-nation EU also spiked higher in October, rising to 2.7 percent from 2.2 percent in September.
The October surge was fuelled by record energy and food prices. Eurozone inflation is now well above the ECB's preferred level of close to but less than two percent.
The data on food prices was particularly disturbing. European prices for bread, cheese and other food increased at the fastest annual pace in more than five years. Food-price inflation in the 13-nation euro region accelerated to 3.8 percent last month, the highest rate since March 2002 and up from 2.4 percent in September.
Time for some interest rate increases perhaps? Or are there some European Banks, overloaded by US subprime CDOs, that need low rates and more liquidity?