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Eurozone inflation rate stands at -0.3% in Feb

Eurozone inflation rate stands at -0.3% in Feb

BRUSSELS: The eurozone’s inflation rate has been confirmed at minus 0.3 per cent in February, up from the low of -0.6 per cent touched in January but still dangerously low as the European Central Bank battles the threat of deflation.

The ECB this month began its €60bn a month bond buying programme to ward off the spectre of deflation in the eurozone, and economic data has for the most part surprised positive this year.

Inflation has been falling largely due to diving oil prices, and the “core” rate – which strips out energy – was actually revised up to 0.7 per cent in February, from the initial 0.6 per cent reading.

Nonetheless, with the inflation rate still firmly in negative territory, there is a danger that companies and households begin to expect prices to continue to fall, and starting a “deflationary mindset” that has proved hard to dispel in Japan.