The EU’s statistic office confirmed today that annual inflation in the euro zone turned negative in September due to lower energy prices.

Eurostat said consumer prices in the 19 countries sharing the euro fell by 0.1 per cent in the year to September, falling below zero for the first time since March.

Compared to previous months, prices were 0.2 per cent higher in September.

Milk, cheese and eggs were cheaper, while heating oil and motor full stripped almost a full percentage point from annual rate. Restaurants and cafes, vegetables and tobacco had the biggest upward impact.

Long term inflation expectations have dropped to their lowest since February.

Under its money-printing quantitative easing scheme, the ECB is buying government bonds and other assets to pump around €1 trillion into the economy, aiming to lift inflation towards its target rate of just under 2 per cent.

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