Eurozone Inflation Hits Three-Year High

Inflation in the eurozone accelerated to its highest level in three years in September, reaching 3.8% according to preliminary estimates from Eurostat.

This marks a significant increase from August's 3.2%, and adds pressure on the European Central Bank as policymakers weigh the impact of rising energy costs against contained underlying price pressures.

The core inflation rate, which excludes volatile food and energy prices, rose to 2.5% in September from 2.4% a month earlier, driven largely by higher services prices.

The European Central Bank faces a delicate balance between containing renewed inflationary pressure without unnecessarily intensifying financial-market strains or weakening economic activity.