European inflation remains at three-year high

Inflation across Europe remained at a three-year high in October despite the economic slowdown across the region.

An initial estimate from the region's statistics office said inflation remained at 3% in the euro area, the same as September's reading.

Inflation was higher than forecast, and remains at a peak last seen in October 2008.

High prices leave the European Central Bank with a dilemma over interest rates.

The ECB raised rates unexpectedly earlier this year to 1.5% and has since resisted calls to lower the benchmark rate, despite the headwinds facing the region from the peripheral economies.

However, many economists expect inflation to peter out in the eurozone, something which would free up the ECB to slash rates.

Meanwhile unemployment also climbed marginally to 10.2% in September, according to a separate report, up from 10.1%.

The rise was unexpected and shows the worsening conditions facing countries across Europe.