There are signs of easing inflationary pressures in some countries. Eurozone, including the largest of all, Germany, rekindling hopes among economists and analysts for a more lenient rate hike in the coming months. However, the President of the ECB Christine Lagarde insists that inflation it has not yet reached its maximum level and portends a further aggressive increase in the cost of borrowings to the market.

Following Spain and Belgium, Germany announced yesterday that consumer prices rose 11.3% in November compared to the same period last year, but slower than the 11.6% rise recorded in October. Data from North Rhine-Westphalia, Germany’s most populous state in particular, where prices fell 0.8% in November from October levels, was also seen as encouraging. Something similar happened in the lands of Baden-Württemberg, Bavaria, Brandenburg and Hesse.

This was preceded by data from Spain, which reported a fourth consecutive monthly decline in inflation in November and more than forecast. Consumer prices in the Iberian country rose by 6.6% in November, decelerating from October, when the index stood at 7.3%. It is worth noting that economists’ forecasts converged at an inflation rate of 7.1%.

In Germany, consumer prices rose 11.3% year-on-year in November, compared with an 11.6% rise in October.

As can be seen from anecdotal evidence, development is driven mainly by lower electricity and fuel costs, and more limited increases in clothing prices. According to Frédéric Ducrose, an economist at Bloomberg, the data point to a slowdown in inflation, which peaked in November, making the ECB’s dovish move at its December meeting more likely a rate hike of just 50 basis points. However, Christine Lagarde does not share his opinion, as she reiterates that inflation in the eurozone has not reached its peak and there is a risk that it will soar even higher than we expect. Speaking before the European Parliament’s Monetary Policy Committee, Ms Lagarde stressed that the ECB is “not done with raising interest rates” while she predicted inflation “has a long way to go”. He even noted that he would be surprised to find that inflation has left its highest levels behind.

Her announcements, however, coincided with a decline in wholesale energy prices, as well as an easing of the heart attack in the supply chain. After all, they were preceded last week by similar statements by Philip Lane, the ECB’s chief economist, who predicted that consumer prices would begin to decline over the next year. However, Mr Lane added that some of the arguments for another 75 basis point rate hike “are no longer valid.” In contrast, Klaus Nott, one of the ECB officials, who on Monday opined that there is nothing certain, even if the eurozone will enter a recession phase, and predicted that “there will be a long period during which politicians and central bankers will watch the situation and take measures to restore price stability.” With a difference of several hours, analysts at Goldman Sachs have calculated that if Italy changes the way it calculates energy prices, inflation in the eurozone could jump from 10.6% in October to 11% in November.