Eurozone inflation eases to 3.6 percent in September

BRUSSELS, October 15, 2008 (AFP) – Inflation in the 15 nations sharing the euro slipped for the second month running in September, easing to 3.6 percent, official EU data showed on Wednesday. Despite the fall in headline inflation, the rate remains well above the European Central Bank’s comfort zone, which it defines as a level of close to but less than 2.0 percent.

The decrease, which came after an annual rate of 3.8 percent in August, was in line with a previous estimate, according to figures from the European Union’s Eurostat data agency.

Twelve-month inflation in the eurozone has steadily slipped since hitting a record 4.0 percent in July as oil prices declined from a peak of nearly 150 dollars a barrel.

“September’s further moderation in inflation was helped by markedly lower oil prices while the upward impact from food prices is now waning,” said economist Howard Archer at consultants Global Insight.

He also said that the European Central Bank would welcome a fall in core inflation, which excludes the impact of volatile items such as energy and food prices, to 2.5 percent in September from 2.6 percent in August.