Introductory remarks by Luis de Guindos, Vice-President of the ECB, at a meeting with business group Hotusa

Madrid, 28 October 2024

Inflation

Inflation in the euro area has come a long way. After peaking at more than 10% in October 2022 (in Spain, it peaked in July 2022), headline inflation stood at 1.7% in September this year. This was 0.5 percentage points lower than in August, largely reflecting a sharp drop in energy inflation. Core inflation has also fallen substantially from its peak, edging down from 2.8% in August to 2.7% in September.

Most measures of underlying inflation have declined or remained unchanged. Domestic inflation remains high, reflecting elevated services inflation as wage pressures remain strong, but it too is showing signs of moderation.

Inflation is expected to rise again later this year – partly due to base effects, as previous sharp falls in energy prices drop out of annual rates – before declining to our target of 2% in the course of next year….