said the inflation rate in March was a negative 0.1 percent, compared with minus 0.2 percent in February while in January, prices rose 0.3 percent. Falling energy prices again were the major factor, down 8.7 percent in March after a fall of 8.1 percent in February.
Earlier this month, the ECB added to its already unprecedented
stimulus programme by slashing record-low interest rates and promising
to pump even more money into the banking system in an effort to get the
banks to lend freely again. Analysts had expected inflation to come in
at a negative 0.1 percent but were still disappointed at the "very weak"
outcome in March.
Jonathan Loynes at Capital Economics said the "figures confirm that
price pressures in the single currency union remain very weak." Loynes
said country data suggested that traditional price increases before the
Easter holidays "could be reversed in April."
"Looking ahead, eurozone inflation is likely to remain close to zero
in the next few months before edging higher in the second half of the
year as negative energy effects finally fade," he said in a note.
"But it looks set to remain well below the ECB's target of close to
2.0 percent, maintaining pressure on the central bank for yet more
source : the daily star