A 0.9% fall in eurozone inflation to 4.3% in September led by an easing of food inflation and plunging energy prices opens the way for the central bank to pause its interest rate hikes. File Photo by Ronald Wittek/EPA-EFE
Sept. 29 (UPI) -- Eurozone inflation fell by an unexpected 0.9% to 4.3% in September as the pace at which prices rose slowed in 15 out of the 20 countries that use the euro, led by an easing of food inflation and plunging energy prices, the European Union's main statistical agency said Friday.
The fall in the annual Consumer Price Index, from a revised 5.2% in August, brings inflation to its lowest level since October 2022 and while the speed at which food prices rose slowed by 0.9%, they continue to tick up at a high 8.8% rate, flash estimates from Eurostat show.
Energy price falls, which have waxed and waned since prices began dropping in May, resumed after easing slightly in August, with the price of energy down by an estimated 4.7% in September.
The closely watched core inflation measure -- which strips out the prices of volatile items such as energy and food, alcohol and tobacco -- slowed to 4.5%, compared to 5.3% in August.
Inflation slowed across the bulk of the economies of the euro area, led by Germany, Latvia and Lithuania, which saw falls in excess of 2%, but gathered pace in Austria, Cyprus, Ireland, Slovenia and Spain.
However, inflation in Cyprus and Spain remained below the eurozone average despite rising by 0.8% and 1.1%, respectively. France -- the zone's second largest economy after Germany -- managed to shave just 0.1% off headline inflation which was estimated at 5.6% in September.
Slovakia's inflation was more than double the eurozone-wide figure at 8.9%, while inflation in Slovenia and Croatia remained on the wrong side of 7%.
The latest fall in inflation, two weeks after the European Central Bank hiked its main refinancing rate by 25 basis points to 4.5%, paves the way for the central bank to pause monetary policy tightening after 10 consecutive increases since it began hiking interest rates in July 2022.