LONDON — Euro-zone consumer prices fell on a year-to-year basis for the fourth consecutive month in September, weighed down by weaker transport, housing and food costs, data showed Thursday.
Half the 16 countries that use the euro registered a drop in prices compared to last year, figures released by the European Union’s statistics agency Eurostat showed, suggesting the European Central Bank has ample room to keep interest rates low and help the region recover from its most severe recession since World War II.
Eurostat said consumer prices were unchanged compared with August, but were 0.3% weaker than a year earlier. In August, consumer prices rose 0.3% on the month and were 0.2% weaker on an annualized basis.
Economists had forecast consumer prices to rise 0.1% on the month in September, but weren’t expecting any change on the year from the preliminary estimate of a 0.3% drop, according to a Dow Jones Newswires survey last week.
Core inflation, which excludes energy, food and alcohol and tobacco, slowed to 0.2% on the month in September from 0.3% in August. That helped the year-to-year core inflation rate ease to 1.2% in September from 1.3% the previous month. Excluding tobacco, consumer prices were steady in September, but down 0.5% in annual terms, Eurostat said.
The breakdown of the annual figures showed a 3.7% drop in transport prices, 1.6% fall in housing prices and 1.3% drop in food prices. Alcohol and tobacco increased 4.4%, a 2.3% gain in miscellaneous goods and services, and a 1.5% increase in household equipment prices.
On a country-by-country basis, the steepest drop in consumer prices in annual terms in the euro zone was in Ireland, where prices slumped 3.0% from a year earlier. Portugal was second, with a 1.8% annual drop, followed by Cyprus, with a 1.2% fall.
Finland registered the strongest rise in prices at 1.1%, followed by Malta, with a 0.8% gain. Consumer prices in Netherlands, Austria, Slovenia, and Slovakia were all unchanged from September 2008.
By Nicholas Winning at nick.winning@dowjones.com Online.wsj
Tobacco is an annual or bi-annual growing 1-3 meters tall with large sticky leaves that contain nicotine. Native to the Americas, tobacco has a long history of use as a shamanic inebriant and stimulant. It is extremely popular and well-known for its addictive potential.
Nicotiana rustica leaves.
Nicotiana rustica leaves have a nicotine content as high as 9%, whereas Nicotiana tabacum (common tobacco) leaves contain about 1 to 3%
A cigar is a tightly rolled bundle of dried and fermented tobacco which is ignited so that its smoke may be drawn into the mouth. Cigar tobacco is grown in significant quantities in Brazil, Cameroon, Cuba, Dominican Republic, Honduras, Indonesia, Mexico, Nicaragua, Sumatra, Philippines, and the Eastern United States.
Tobacco is an agricultural product processed from the fresh leaves of plants in the genus Nicotiana. It can be consumed, used as an organic pesticide, and in the form of nicotine tartrate it is used in some medicines. In consumption it may be in the form of cigarettes smoking, snuffing, chewing, dipping tobacco, or snus.
