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Euro zone inflation slows in September on cheaper energy

Euro zone inflation slows in September on cheaper energy

Euro zone inflation slowed further year-on-year in September because of cheaper energy, new figures showed today.

But the core measure excluding such volatile components rose, the first estimate from the European Union’s statistics office Eurostat showed.

The numbers underline the difference of opinion over the state of the euro zone economy among the governors of the European Central Ban.

The ECB wants to keep inflation below, but close to 2% over the medium term but has so far failed to boost price growth despite years of unconventional steps.

Eurostat said consumer prices in the 19 countries sharing the euro rose 0.2% month-on-month in September for a 0.9% year-on-year gain, slowing from 1% in August.

Economists polled by Reuters had expected a flat reading at 1% year-on-year.

The lower than expected September number was mainly due to a 1.8% year-on-year fall in energy prices.

Without energy and the equally volatile unprocessed food, or what the European Central Bank calls core inflation and watches in monetary policy decisions, price growth accelerated to 1.2% in September from 1.1% in August.

Also the even more restrictive core inflation measure, looked at by many market economists that in addition excludes alcohol and tobacco, accelerated to 1% from 0.9% year-on-year.

At its September 12 monetary policy meeting, the ECB decided to resume asset purchases designed to loosen monetary policy.

This decision was opposed by a third of the policymakers, including Germany’s Sabine Lautenschlaeger, whose decision to resign before the end of her term was announced last week.

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