Year-on-year inflation in the OECD, as measured by the Consumer Price Index (CPI), decreased for the third consecutive month, from 5.6 per cent in October to 5.4 per cent in November 2023.

Declines in inflation between October and November 2023 were recorded in 28 OECD countries, the same number as between September and October. However, the fall in headline inflation was less pronounced than in the previous month.

In the Netherlands, Denmark and Belgium, headline inflation picked up again after a period of decline. Core inflation (inflation less food and energy) in the OECD continued to decline slightly, from 6.5 per cent in October to 6.3 per cent in November, its lowest level since April 2022.

In the euro area, year-on-year inflation as measured by the Harmonised Index of Consumer Prices (HICP) fell further, reaching 2.4 per cent in November following 2.9 per cent in October, with relatively larger declines in food and core inflation and a less pronounced decline in energy inflation.

In December, Eurostat’s flash estimate pointed to an increase in euro area inflation to 2.9 per cent, with a slowing decline in energy prices, while core inflation is estimated to have continued to decrease. Inflation is estimated to have risen markedly in December in Germany, reflecting a base effect due to a one-off measure on gas and heating bills (known as ‘December immediate assistance’) in December 2022.

---