BRUSSELS, April 16 A shock drop in March euro
zone inflation to its lowest level since November 2009 was
confirmed on Wednesday, keeping pressure on the European Central
Bank to intervene should prices not rebound.
The year-on-year inflation rate in the 18 countries sharing
the euro was 0.5 percent in March against 0.7 percent in
February, the European Union's statistics office Eurostat said.
The biggest rise in prices was observed for tobacco,
restaurants and bars as well as milk, cheese and eggs, while
lower prices were recorded for heating oil, telecommunications
There was a stark disparity across the eurozone with
countries such as Greece (-1.5 pct) and Cyprus (-0.9 pct) seeing
their prices fall compared to last year.
Inflation rates in Austria (+1.4 pct), Malta (+1.4 pct) and
Germany (+0.9 pct) were nearer to the ECB's target of close to
but below 2 percent.
Inflation has now been in the ECB's "danger zone" of below 1
percent for six consecutive months, fuelling speculation that
the ECB will need to take further action.
ECB policy makers said the bank stood ready to deploy
unconventional measures to ensure that inflation did not stay
low for too long.
ECB's President Mario Draghi expressed concerns at the
euro's strength on Saturday in Washington, trying to talk down
the currency, which influences domestic prices.
The strength of the single currency against the dollar makes
imports cheaper and pushes down the prices Europeans pay for
goods and services.
While this can give households more purchasing power in the
short run, the ECB wants to avoid a drop in inflation
For March inflation TABLE please see ]
Euro zone inflation rate vs target and ECB refinancing rate
For more on economic indicators please see: here
(Reporting by Robert-Jan Bartunek and Martin Santa; editing by