Inflation in the eurozone soared to a record level of 10.7%

The eurozone crisis deepened as inflation hit record highs and the economy slowed sharply.

Official data showed inflation rose to 10.7 percent last month – much worse than expected, up from 9.9 percent in September.

In another blow, separate figures showed the eurozone economy grew just 0.2 percent in the third quarter, up from 0.8 percent in the previous three months.

The double whammy underscored the scale of the task facing the European Central Bank (ECB) as it raises interest rates to bring inflation back under control without tipping the economy into recession.

According to the data of the official statistical agency Eurostat, inflation was double-digit in 11 of the 19 countries of the single currency zone.

Energy prices were the biggest headline driver, rising 41.9 percent as Vladimir Putin continued to cut gas supplies to Western Europe.

Price pressures are holding back economic growth, and experts fear the economy will shrink and slip into recession in the coming months.

However, with GDP still on the rise, some believe there is room to unleash further sharp interest rate hikes as the ECB focuses on killing inflation.

Last week, the ECB raised rates by 0.75 percentage points to the highest level since 2009.

It has raised rates by a total of two percentage points over the past three months and indicated that a further increase could come in December.

Price pressures are holding back economic growth in the eurozone

Andrew Cunningham, chief economist for Europe at Capital Economics, said: “The increase in eurozone GDP in the third quarter does not change our view that the eurozone is on the brink of recession. But with inflation jumping well over 10 percent, the ECB will prioritize price stability and continue to raise rates regardless.”

Commerzbank senior economist Christoph Weil said: “The ECB’s goal of returning inflation to just under 2 percent on a sustainable basis appears to be a long way off.”

The ECB is grappling with the biggest jump in prices since records began in the eurozone in 1997.

Yesterday’s data showed that rampant inflation was caused not only by a sharp rise in gas and electricity prices: food, alcohol and tobacco rose in price by 13.1 percent.

Even excluding these changing factors, the “core” measure of inflation continued to creep upward, reaching 5 percent.

In Germany, the growth of consumer prices was 11.6%, in France – 7.1%, in Italy – 12.8%. Rising prices are a concern around the world, but more prominently in Europe.