FRANKFURT, Germany (AP) — Inflation hit a new record in the 19 countries that use the euro currency, fuelled by out-of-control prices for natural gas and electricity due to Russia’s war in Ukraine. Economic growth also slowed ahead of what economists fear is a looming recession, largely as a result of those higher prices sapping Europeans’ ability to spend.

Annual inflation reached 10.7 per cent in October, the European Union’s statistics agency Eurostat reported Monday. That is up from 9.9 per cent in September and the highest since statistics began to be compiled for the Eurozone in 1997.

Natural gas prices skyrocketed in the wake of the invasion of Ukraine as Russia throttled back pipeline supplies to a trickle of what they were before the war. Europe has had to resort to expensive shipments of liquefied gas that come by ship from the US and Qatar to keep generating electricity and heating homes.

Natural gas prices for short-term purchases have eased recently but remain high on markets for coming months, suggesting that costly energy may be a persistent drag on the economy. A survey of professional forecasts last week by the European Central Bank showed expectations for inflation next year rose to 5.8 per cent from the 3.6 per cent predicted three months ago.

Eurostat figures showed prices for food, alcohol and tobacco have increasingly joined energy prices as a major contributor, rising 13.1 per cent, while energy prices rose an astronomical 41.9 per cent from a year earlier.

Inflation figures varied widely by country, from 7.1 per cent in France to 16.8 per cent in the Netherlands among the biggest member economies, while the highest were in the three Baltic countries: Estonia at 22.4 per cent, Latvia at 21.8 per cent, and Lithuania at 22 per cent.

The economy, which had been rebounding from the novel coronavirus pandemic, showed growth of 0.2 per cent in the July–September period, slowing from 0.8 per cent in the second quarter. Economists say a major reason is higher prices, and many are predicting the economy will shrink over the last months of this year and the first part of next year.

The growth in gross domestic product (GDP) was higher than expected because of extensive government support that softened the blow to people’s incomes from inflation as well as pent-up savings that consumers had left over from the worst of the pandemic restrictions, said Joerg Zeuner, chief economist at Union Investment.

“However, there’s no cause for celebration,” he said. “The GDP numbers, along with many other indicators, show that the economy has clearly lost steam over the summer.”

With more recent data weakening, “it is a matter of how deep the recession will be and not if there will be one”, wrote economists at Oxford Economics.