Consumer prices in the eurozone (20 countries using the euro) in September rose 2.2% from a year earlier in a preliminary estimate.
According to Eurostat, the EU statistics agency, on the 1st (local time), the eurozone inflation rate fell to 1.9% in May and then came in at 2.0% in June, July and August. The core consumer price index, which excludes the more volatile energy, food, alcohol and tobacco, held at 2.3% for the fifth straight month.
Although the increase widened somewhat for the first time in three months, considering the overall economic trend, it appears to be a temporary phenomenon and not at a level that would worry policymakers, Reuters said in an analysis. Bloomberg also predicted that at least until the next currency policy meeting on the 30th, the stance of holding rates steady will remain in place.
In this regard, European Central Bank (ECB) President Christine Lagarde said the previous day, "With the current policy rate at 2%, we are in a good position to respond even if the risk level of inflation changes or a new shock emerges that threatens our goal."
The ECB cut the policy rate eight times from June last year through June this year, by a total of 2.00 percentage points. The deposit rate fell from 4.00% to 2.00%. As the eurozone consumer price inflation stabilized around the 2.0% target, the ECB decided at its July meeting to pause rate cuts for the time being.