Deflation continues in Europe

According to Eurostat, the rate of inflation has been negative in Europe during the past four months (from June until September).
In August, prices have fallen 0,2% and in September 0,3%, which is mainly due to the fall of oil prices and sharp drop in food prices. As a result of this deflation, consumers wait for making pricey purchases which has the consequence that there is also an economic output fall. But analysts expect that the deflation comes to an end; prices will be more expensive as from November and inflation will climb up further going into 2010.

Elien Wanzeele