EUROPEAN INFLATION: September EZ HICP Y/Y In Line W/ Revised Consensus

Eurozone September flash headline, on a rounded basis, came in in line with consensus on the yearly rate at 1.8% Y/Y (vs 1.7% MNI tracking, 1.8% cons; 2.2% prior). Note that consensus was downwardly revised by 0.1pp following soft French and Spanish data.

• This is the first time headline HICP prints below the ECB's 2% target since June 2021.
• On a monthly basis, inflation came in at -0.1% M/M (vs 0.0% cons; 0.1% prior).
• On an unrounded basis, headline HICP was 1.77% Y/Y and -0.07% M/M.
• Core HICP printed in line with consensus, at 2.7% Y/Y (vs 2.8% prior; unrounded: 2.68% Y/Y, 0.08% M/M).
• Looking at the individual categories: services, energy and core goods were all a tenth lower than expected from the median of the previews that we read.
• Services inflation came in 0.1pp below its August rate, at 4.0% Y/Y, but remained between 4.0% to 4.1% since last November (with the exception of April 2024). It was expected to remain at 4.1%Y/Y from the median of the previews that we had read.
• Energy was the biggest downward contributor (broadly as expected), falling 6.0%Y/Y (the median in our preview was a fall of 5.9%Y/Y) vs -3.0% prior.
• Non-energy industrial goods inflation remained unchanged at 0.4%Y/Y. The median in our preview was 0.5%Y/Y - so this was also marginally lower than expected.
• Food, alcohol and tobacco came in at 2.4%Y/Y - a tenth higher than August.