Inflation Pickup Comes With Bad News for ECB

Euro-area inflation accelerated at the fastest pace in more than two years in October. But what looks like progress in stoking consumer prices actually contains some bad news for the European Central Bank.

Policy makers including ECB chief economist Peter Praet have warned repeatedly that they're lacking convincing signs of underlying price pressures, and inflation data published Monday proved them right. Digging deeper into the figures shows the core rate, which excludes volatile items such as food and energy, fell to the lowest in six months. That's critical since the central bank views the measure as a guide for where headline inflation will settle.