Euro zone inflation disappoints, sinking below expectations

Euro zone inflation dropped to 2.4% in November, below expectations of 2.7%, while core inflation fell from 4.2% to 3.6%. The European Central Bank remains cautious about declaring victory over price rises as they monitor potential pressures from wage increases and energy markets. Inflation in Germany and France also decreased to 2.3% and 3.8% respectively. Traders may bring forward expectations for the first ECB rate cut, but concerns over labor market tightness suggest rate cuts may come later. Unemployment in the euro area remained at a record low of 6.5% in October despite a contraction in the euro zone economy in Q3.