Durrant Pate/Contributor

There is much concern across Europe today, as a quickening of inflation in the continent’s largest economies in September is causing concerns for policymakers.

Inflation in the 20 nations sharing the Euro picked up to 2.2% in September from 2.0% in August. A more closely watched core figure, which excludes volatile food and fuel prices, meanwhile held steady at 2.3%, despite a pick-up in services inflation, fresh data from Eurostat showed on Wednesday.

Inflation concerns have reinforced a holding pattern for interest rates by the European Central Bank (ECB). Although the ECB spent the past four years battling excessive inflation, this uptick is unlikely to fuel too many concerns among its policymakers, as broader economic trends suggest this is a temporary blip and numbers could soon head back to, then below, the ECB’s 2% target.

“As we can model the future, the risks to inflation appear quite contained in both directions,” ECB President Christine Lagarde said on Tuesday noting “with policy rates now at 2%, we are well placed to respond if the risks to inflation shift, or if new shocks emerge that threaten our target. “Still, some policymakers are likely to use the September figure as an argument against easing rates further and the bank is almost certain to keep rates on hold for the third straight meeting on October 30.

Inflation numbers across Europe

In Germany, consumer prices rose 2.4.% in September from a year ago on gains in services costs. That’s the fastest annual pace since February. Price pressures also ticked up in the 20-nation bloc’s other top economies. This follows an uptick in inflation among the euro zone’s other top economies, with France, Italy and Spain all seeing higher readings.

Swiss inflation stayed unexpectedly low in September, posing a challenge to the central bank at a time when the economy is also suffering from outsize US tariffs. The result may keep the prospect of more easing on the agenda of Swiss National Bank officials, who have already cut their interest rate to zero. Last week they refrained from lowering it into negative territory again to avoid hurting the financial system, but some economists still expect that to happen at their next meeting in December.

Italy’s cabinet approved a budget featuring a deficit at just 3% of output this year, allowing Premier Giorgia Meloni’s government to set aside more money for tax cuts and defense. The milestone of reaching the European Union’s 3% ceiling this year could open the door to Italy exiting the bloc’s excessive deficit procedure, the monitoring regime known as EDP that features a list of shame for countries with bloated deficits.

Denmark is on heightened alert and stepping up its drone defenses before European leaders meet in Copenhagen this week, as a new suspected drone intrusion temporarily shut airspace and intensified security concerns. The government has now also raised its threat level for the energy industry, imposing stricter security requirements on facilities.