Eurozone inflation slows, industrial output jumps

Euro zone consumer prices rose 0.3 per cent in September and 2

Euro zone consumer prices rose 0.3 per cent in September and 2.5 per cent from a year ago while industrial output rose by a larger-than-expected 1.1 per cent in August, the EU statistics agency Eurostat said today.

Economists polled by Reuters news agency had on average expected consumer prices to rise 0.2 per cent from the previous month and 2.4 per cent from a year earlier.

They had been looking for industrial production to rise 0.7 per cent in August and fall 0.1 per cent from a year ago. Eurostat said the monthly increase seen in August was the largest since July 2000.

However, analysts had said before the release of the data that a strong monthly rebound in output was inevitable given the decline seen in July when some firms closed their factories for summer holidays. Industrial production fell 1.3 per cent in July.

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The 12-nation region's inflation rate is now at its lowest since January, Eurostat said. It moved closer to the European Central Bank's self-imposed two per cent ceiling from August's 2.7 per cent.

The data comes a day after ECB council member Mr Ernst Welteke said the bank could have room to lower interest rates if the euro zone inflation picture improved further.