Eurozone consumer price inflation is expected to have hit the 2% mark in October, according to new data released on Tuesday, a return to the bloc's target rate.

The latest reading hit estimates and is up from September's annual increase of 1.7%. Core inflation – a measure which strips out volatile elements such as food and energy – is estimated at 2.7% in October.

The data showed that the services sector was the main driver of price increases last month, up 3.9% year-on-year, but stable compared with September.

Food, alcohol and tobacco came in after services, up 2.9% annually, compared with 2.4% in September.

Energy prices are lower compared with last year, down 4.6%. Energy prices also saw a 6.1% drop in September.

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This time last month, the European Central Bank (ECB) cut interest rates for a third time this year, a move that lowered the rate that the ECB pays on banks' deposits to 3.25%, from 3.5%. October's cut was the first back-to-back interest rate cut in 13 years.

Eurozone inflation has also been falling by more than initially thought in recent months. Separate data released by statistics body Eurostat revealed that consumer prices across the euro area rose by 1.7% in the year to September, down from 2.2% in August.

This marked the first time since June 2021 that annual inflation has dropped below the 2% threshold, which the ECB views as optimal for price stability.

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