Relief for the eurozone as inflation stays stable at 0.4 per cent

 
Emma Haslett
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All eyes will be on ECB measures aimed at strengthening eurozone economies (Source: Getty)

Finally, a bit of relief for eurozone watchers: figures published this morning show inflation in the 18-country bloc stayed at 0.4 per cent in August, rather than falling to 0.3 per cent as originally feared.

The European Union's statistics agency revised its "flash" estimate upwards - but it remains the eurozone's lowest rate of inflation since October 2009.

The news comes as the European Central Bank prepares to introduce measures aimed at strengthening sluggish recovery in eurozone economies. Earlier this month it announced a programme of fiscal stimulus, which included cutting rates to a record low of 0.05 per cent and launching programmes to buy covered bonds and asset-backed securities.

Howard Archer, the chief UK and European economist at IHS Global Insight, called the figures a "scrap of good news".

While this does not materially change the picture of extended worryingly low Eurozone inflation, the ECB will likely be pleased for any piece of news that suggests that the downward trend in inflation could be stabilizing.

But he added the bloc is still on the brink.

August marked the 11th successive month that Eurozone consumer price inflation has been less than 1.0%, and it was still at the equal lowest level since October 2009. Inflation is substantially below the European Central Bank (ECB)'s target of "close to, but just below 2.0%" and uncomfortably near to moving into deflationary territory..

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