Shock drop in March eurozone inflation increases pressure for action from ECB

2014-04-16 316

There is confirmation that eurozone inflation last month fell to its lowest level since November 2009.

Year-on-year the inflation rate was just half of one percent, down from February’s 0.7 percent.

Prices fell for heating oil, telecommunications and fuel. They rose for tobacco products and in restaurants and bars as well as for milk, cheese and eggs.

That keeps pressure on the European Central Bank to intervene to prevent deflation and stagnation.

Annual inflation was negative in eight of the 18 eurozone countries. In Greece it was down 1.5 percent. and Cyprus it was minus 0.9 percent.

By contrast inflation rates in Austria (+1.4 pct), Malta (+1.4 pct) and Germany (+0.9 pct) were nearer to the ECB’s target of close to but below 2.0 percent.

Inflation has now been in the ECB’s “danger zone” of below 1.0 percent for six consecutive months,