The eurozone economy grew stea­dily in the three months following Britain’s surprise vote last June to leave the EU. GDP estimates pub­lished last week by Eurostat showed that eurozone economic growth stabilised in the third quarter as it expanded by 0.3 per cent sequen­tially, unchanged from the rate of growth in the second quarter. On a yearly basis, eurozone GDP growth remained steady at 1.6 per cent.

Higher investment in construc­tion contributed to overall growth, suggesting that the ECB’s record-low interest rates are assis­ting the econo­mic recovery. In the EU as a whole, GDP climbed 0.4 per cent from the previous quarter and by 1.8 per cent from the same period last year.

Britain’s inflation rate registered a surprise fall in October, although there were signs that consumer pri­ces will start to nudge higher. Ac­cording to the Office for National Sta­tistics (ONS), Consumer Prices Index (CPI) inflation declined to 0.9 per cent in the review month, from one per cent in September. This was below the 1.1 per cent forecast by economists, who were of the opinion that sterling’s fall would underpin consumer prices. But the ONS said factory gate prices and raw material costs rose much faster in October. The prices of goods leaving factories increased by 2.1 per cent, faster than expected and the largest increase since April 2012. On the other hand, costs incurred by producers for raw materials and oil also showed a record monthly increase of 4.6 per cent in October.

In the US, a Commerce Depart­ment report last week showed that US housing starts recovered much more than anticipated in October following a sharp decline in new residential construction in Sep­tem­ber. The department said  hou­sing starts climbed by 25.5 per cent to an annual rate of 1.32 million in Octo­ber following a fall of 9.5 per cent from a revised of 1.05 million during the previous month. Economists had forecast housing starts to rise by 11.6 per cent to 1.168 million, from 1.047 reported in September.

This report was compiled by Bank of Valletta plc for general information purposes only.