BERLIN — Price gains in Germany and Spain cooled in November, after months of climbing steadily, as lower energy prices helped to ease the pressure on consumers and businesses in two of Europe’s largest economies.
Yet even as signals pointed to easing inflation, Christine Lagarde, the president of the European Central Bank, said on Monday that she did not believe that inflation in 19 countries using the common European currency had peaked.
“Obviously in the longer term, inflation will decline, if only because of our monetary policy,” she said. But she added that looking at the key price drivers like energy, food and housing, “we do not see the components that would lead me to believe that we have reached peak inflation.”
Consumer prices across the eurozone jumped in October to a record annual rate of 10.7 percent, according to data reported by the European Commission. Eurozone inflation data for November is scheduled to be released Wednesday.
In Germany, the annual rate of inflation slipped to 11.3 percent in November, down from 11.6 percent the month before, data released Tuesday by the federal statistics office showed. It was the first month since June that price gains had slowed, although they remain at record levels and economists do not expect them to retreat significantly until 2024.
The inflation report comes on the back of signals last week that the German economy was proving more resilient than feared to the fallout from Russia’s war in Ukraine and the ensuing energy crunch. Germany, which was more heavily dependent on Russian natural gas than many of its neighbors, was hit particularly hard by Russia’s decision to limit gas flows after it invaded Ukraine on Feb. 24.
For months, the high price of energy has been the main driver of inflation in Germany, but in November, the price of food jumped 21 percent compared with the same month a year ago, officials said. Energy prices still remain more than a third higher than what they were a year ago, but higher levels of natural gas storage and a willingness by consumers to cut usage have helped to ease pressure on prices.
Spain also showed indications that inflation was slowing, as the rate of consumer price increases in November was 6.6 percent, down from 7.3 percent in October, data from the National Statistics Institute showed on Tuesday. The institute credited a drop in fuel and electricity prices as compared to the same month last year, as well as a slower increase in the prices of apparel compared with 2021.
The Spanish government was one of the first in Europe to intervene in the economy last year, cutting taxes on energy to help households cope with the rising prices. Last month, it introduced a 3 billion euro package aimed protecting the country’s most vulnerable population.
In Germany, there have been signs of a strengthening economy, with a key indicator of business sentiment among executives rising more than expected in November after months of decline.
“The recession could prove less severe than many had expected,” the Ifo Institute in Munich, which compiled the survey, said in a statement.
The improved outlook follows unexpected economic growth in the July-September period. The country has succeeded in filling its natural gas storage facilities more quickly than expected, and is racing to build terminals to import liquefied natural gas, or L.N.G.
Despite the positive reports, a recession looms. The government is predicting the economy will contract 0.4 percent next year, although a panel of economic advisers recently forecast that growth will decline only 0.2 percent.