Eurozone inflation drops further to 0.4 percent

Staff Writer
Columbus CEO

BRUSSELS (AP) — Official data show the inflation rate in the 18-nation eurozone fell further in July, to 0.4 percent from 0.5 percent a month earlier.

The preliminary figures published Thursday by the European Union's statistical agency are likely to add pressure on the European Central Bank to beef up its efforts to raise inflation and spur the economy.

The Eurostat agency says the core inflation rate — which excludes volatile food and fuel costs — remained unchanged on the month at 0.8 percent.

The ECB has vowed to fight the persistently low inflation rate but has so far refrained from bolder counter-measures such as large-scale asset purchases.

The low inflation rate worries policy makers because it could slip further and lead to a deflationary spiral in which falling prices choke off growth.