(Reuters) – Inflation accelerated in November in the euro zone and its most watched components remain high, preliminary data published by Eurostat on Friday showed, strengthening bets on a 25 basis point cut in rates directors of the European Central Bank next month.

The consumer price index calculated according to European standards (HICP) increased by 2.3% year-on-year in November in the 20 countries sharing the European currency, in line with the consensus and after 2.0% in October.

Excluding the most volatile items such as unprocessed food products and energy, inflation stood at 2.8% in November, as expected by the consensus and after 2.7% in October.

The pace of growth of a narrower measure of price rises that excludes food, energy, alcohol and tobacco – the measure most closely monitored by the ECB for setting interest rates – remained stable at 2.7 %, compared to 2.8% anticipated by the consensus.

However, these figures do not change much in the overall picture of inflation which is slowly moving towards the ECB’s target next year.

François Villeroy de Galhau, governor of the Banque de France and member of the board of governors of the Frankfurt-based institution, reiterated on Friday his hope that inflation in the euro zone could sustainably return to the 2% target of ECB in 2025 and “even probably in the first half of next year, rather than at the end”.

“Disinflation is happening faster than expected, which is good news,” he declared during the “Dijon Economy Days” held in Dijon.

The President of the European Central Bank (ECB), Christine Lagarde, also said last month that inflation could return to the 2% target more quickly than expected.

The ECB’s latest projections predict a return to the 2% inflation target in the last quarter of 2025.

(Written by Corentin Chappron and Diana Mandiá, edited by Blandine Hénault)

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