In the euro zone, the price decrease for goods and services was mere 1.7%.
Positive development for ECB in its battle against inflation: Prices of goods and services in the eurozone grew by merely 1.7% in September compared to the same period last year, as per Eurostat's announcement today, moments before the ECB's impending interest rate decision.
The final inflation figure for the recent month now turns out to be marginally less than Eurostat's earlier forecast. Originally, they had predicted a 1.8% rate. Prices of energy products dropped by 6.1% in comparison to the previous year, leading to a decrease in the overall inflation rate and pushing it to its lowest point in over three and a half years. It currently lies comfortably under the central bank's desired 2% threshold. In August, it was at 2.2%. With inflation significantly decreasing, most analysts anticipate the ECB to lower interest rates once more.
The stewards of the currency, headed by ECB President Christine Lagarde, decreased interest rates for the first time since their policy shift in June. Currently, many professionals predict the main deposit rate, where banks deposit their surplus funds with the central bank, to drop by another 0.25 percentage points, bringing it down to 3.25%.
The ECB might consider expanding its services to include more measures to further combat low inflation, offering other services that could aid in maintaining price stability. Given the current low inflation rate, the decrease in interest rates could also incentivize banks to invest more in other services, potentially stimulating economic growth.
