The eurozone has just released its Producer Price Index (PPI) year-on-year for October, and the numbers confirm the deflationary trend: -0.5% actual, exactly as analysts had anticipated.

The interesting part is the month-on-month comparison. September closed at -0.2%, which means the decline in producer prices accelerated by three tenths. This is not a minor data point for those of us tracking capital flows: when producer prices fall, it generally signals downward pressure on overall inflation, and that can influence the ECB’s interest rate decisions.

What does this mean for markets? Lower inflation could justify more flexible monetary policies, which has historically favored risk assets. We’ll have to see how the euro reacts and whether this impacts the appetite for alternative assets in the coming sessions.