There was a double dose of bad news for the euro zone economy today as separate figures showed inflation accelerating and economic confidence slumping.
Official figures showed that the annual rate of inflation jumped to 3% in November, the highest rate in over six years and well above the European Central Bank's preferred level of just below 2%.
The rate compared with 2.6% in October, the EU's Eurostat data agency said, with the gains driven by high oil and food prices. Economists had predicted a slightly lower rate of 2.8%.
The ECB has not hiked interest rates to combat inflation since June in the light of a global credit squeeze sparked by the crisis in the US sub-prime home loan market.
Meanwhile official figures confirmed euro zone economic growth of 0.7% in the third quarter of 2007, after 0.3% in the second quarter.
Meanwhile, the European Commission's euro zone economic sentiment indicator retreated in November to 104.8 points, down 1.2 points from October. Analysts had predicted a drop but not such a marked one.
Among Europe's biggest economies, confidence deteriorated sharply in Britain and Italy, and to a lesser extent in France and Spain. But German confidence saw a very mild rebound.
A separate euro zone business climate indicator from the European Commission recovered slightly, rising to 1.04 points in November from 0.88 in October.
