Eurozone producer price index tumble in September

Eurozone producer prices in September fell at the fastest pace since the turn of the year, data released on Wednesday showed.

According to data released by the European Union’s statistical office, the producer price index for the domestic market fell 3.1% year-on-year following a 2.6% decline in the previous month.

The figure, however, was smaller than the 3.3% drop analysts had expected.

On a month-on-month basis, producer prices declined 0.3% after a 0.8% fall in August, compared with analysts’ expectations for a 0.5% drop.

The decline, the third consecutive monthly fall, was driven by a 0.8% fall in energy prices and a 0.5% decline for intermediate goods.

“The Eurozone recovery appears to have maintained a modest pace at the beginning of fourth quarter,” said Jack Allen, European economist at Capital Economics.

“But current rates of growth are too weak to generate much upward pressure on inflation.

“Accordingly, today’s data are unlikely to sway the ECB from cutting interest rates and expanding its QE programme in December.”