Eurozone inflation hits two-year high

 Eurozone consumer prices rose to a near two-year high of 0.4 percent in September, data showed Friday, offering hope that a disputed programme by the ECB to stimulate the economy may be delivering.

AFP| Last Updated: Sep 30, 2016, 15:08 PM IST
Eurozone inflation hits two-year high

Brussels: Eurozone consumer prices rose to a near two-year high of 0.4 percent in September, data showed Friday, offering hope that a disputed programme by the ECB to stimulate the economy may be delivering.

Eurozone unemployment meanwhile was unchanged at 10.1 percent in August, the Eurostat statistics agency said.

Both figures were in line with forecasts by analysts surveyed by financial services company Factset.

The eurozone`s ultra-low inflation is a huge worry for the European Central Bank, whose goal is to keep inflation near 2.0 percent.

Inflation reflects underlying consumer demand in the economy and while higher this month, 0.4 percent means Europe is still short of a full-fledged recovery.

The bank earlier this month decided to hold its record-low interest rates steady in a bid to encourage lending and drive up inflation. 

It also opted to leave intact the bank`s ultra-loose monetary policy, choosing to stay the course with a massive asset-buying programme to the tune of 80 billion euros a month.

But critics, led by Germany, say these policies are biting into the savings of Europeans and helping stoke the rise of populist politicians.

The data landed two days after ECB chief Mario Draghi defended his inflation boosting policies in a tense session at German parliament. 

Angry lawmkers in Germany`s Bundestag warned that the ECB`s fight to stimulate inflation was in fact causing damage to the European economy.

The eurozone inflation rate last hit 0.4 percent in October 2014.