All tricks and no treats in Euro-Zone Inflation data

Prices jump 10.7% and GDP rose 0.2% in October.

Euro-area inflation rose to a new high, while the economy lost momentum, rattling the markets as fears of a recession are now but on the cards.


European bonds remained lower after the data, with 10-year German yields four basis points higher at 2.15% The euro is down 0.3% at $0.9937 today.


Slower growth and stronger inflation are a Halloween nightmare for the ECB as they struggle to think how they can get inflation under control, the inevitable is the Central Bank needs to do further interest rate hikes.


The ECB acknowledges that a euro-area recession is becoming more and more likely in the coming quarter, also the Central bank cannot deal with energy prices, which is adding to the dilemma.

The outlook for the euro-zone remains extremely uncertain, while ECB officials maintain that the priority is to fight inflation, other officials are showing concern about a downturn, cautioning against pushing rates too high too quickly.


How this debate turns out will be revealed in December, in the meantime, it's a rocky road for the Euro.