Inflation in OECD countries remained stable in November

Continued decline in energy prices kept inflation in check

A person pulls a cart past a deli and souvenir shop at the Staten Island Ferry terminal in New York. Inflation was stable in the US in November 2020 at 1.2 per cent. AFP 

Annual inflation across some of the world’s biggest economies remained stable at about 1.2 per cent in November last year, according to the Organisation of Economic Cooperation and Development.

Energy prices across the 37-member bloc continued to decline – dropping 8.1 per cent in November compared with a 7.7 per cent decline in October – while food price inflation slowed to 3.3 per cent from 3.6 per cent a month earlier.

“Excluding food and energy, annual inflation was also stable at 1.6 per cent in November,” the Paris-based organisation said on Thursday.

There were marked differences in price changes across the world. Inflation was stable in the US at 1.2 per cent. It dropped in the UK (to 0.6 per cent from 0.9 per cent), while it picked up in Canada (to 1 per cent from 0.7 per cent) and France (to 0.2 per cent from 0.0 per cent).

In Japan and Germany, overall prices continued to fall in November by -0.9 per cent and -0.3 per cent, respectively, at a faster pace than in October (-0.4 per cent and -0.2 per cent respectively).

In Italy, inflation continued to fall in November to -0.2 per cent but at a slower pace than in October (-0.3 per cent), according to the OECD.

Across the G20 group of the world’s biggest economies, annual inflation decreased to 2 per cent in November, compared with 2.2 per cent in October. Non-OECD countries like Argentina, China, India and South Africa all reported lower rates.

Annual inflation decreased in Argentina (to 35.8 per cent from 37.2 per cent), China (to -0.5 per cent – the first negative rate since October 2009 – from 0.5 per cent), India (to 5.3 per cent from 5.9 per cent) and South Africa (to 3.2 per cent from 3.3 per cent).

Inflation increased in Russia (to 4.4 per cent, from 4.0 per cent), Brazil (to 4.3 per cent, from 3.9 per cent), and Indonesia (to 1.5 per cent from 1.3 per cent). It was stable at 5.8 per cent in Saudi Arabia.

The economic activity in the world's 20 largest economies rebounded in the third quarter of 2020 after record declines caused by Covid-19 in the first half, the OECD said in a report in December. The gross domestic product of G20 countries rose by 8.1 per cent from the previous quarter, the organisation said. However, the recovery remained 2.4 per cent below the pre-pandemic high recorded in the last quarter of 2019.

Annual inflation and inflation excluding food and energy in the euro area both remained stable for the third consecutive month in November at -0.3 per cent and 0.2 per cent, respectively. Eurostat’s flash estimate for December points to another month of stability in both measures (-0.3 per cent and 0.2 per cent), the OECD statement said.