Eurozone Inflation Nears ECB Target

European Central Bank board member Joachim Nagel stated that inflation in the eurozone is practically at the 2% target, expecting it to hover around this level despite price pressures from U.S. tariffs. Inflation in the 20 countries using the euro rose slightly to 2.2% in November from 2.1% in October, a minor increase unlikely to concern the ECB, which is set to keep interest rates unchanged this month. Germany’s Stern magazine quoted Nagel, also president of the Bundesbank, saying: “We have practically achieved our goal, and inflation will continue to fluctuate around this value in the near future.” Nagel downplayed the impact of rising U.S. inflation on the ECB, attributing it to import tariffs, but warned that conditions could worsen if the Federal Reserve cuts interest rates. On Germany’s economic outlook, Nagel noted that spending on the military and infrastructure could push growth above 1% by 2027, though structural challenges such as a shrinking workforce must be addressed. The ECB left rates unchanged at 2% for the third consecutive meeting in October, offering no signals of future moves, benefiting from a rare period of low inflation and stable growth despite trade disruptions. The bank had cut rates by two percentage points earlier this year up to June but has not adjusted them since. Sources - Agencies