(MENAFN– ecpulse) The euro area`s inflation rate rose at the slowest rate in over four years, according to flash estimate from Eurostat, the statistical office of the European Union.
At 0.50% in March, the flash Consumer Price Index (CPI) was down from February`s gain of 0.7%. That trailed analysts` median forecast of a 0.6% gain, and way under the European Central Bank`s inflation target of just below 2%, suggesting more action could be done to shore up the bloc`s recovery as the bank`s governing council meets to set the interest rates later this week.
Experts are still split over whether the ECB will increase stimulus to counter the risk of deflation, after the surprising slip in consumer prices to the lowest since November 2009.
ECB President Mario Draghi is weighing the stream of economic data when it comes to setting monetary policy. Tomorrow, the unemployment report should offer further hints about economic outlook ahead of the ECB`s monthly policy meeting on Thursday.
Earlier this month, Draghi said the ECB is ready to introduce additional policy steps to guard against deflation taking hold in the region as the strong euro weigh on consumer prices.
The Core CPI, which excludes volatile items such as foods and fuel, rose 0.8% as expected, after a 1.0% rise in February.
The euro yo-yoed against the dollar after the inflation report, first falling as low as $1.3725 compared with the previous close at 1.3779, then rebounding shortly as high as $1.3780.
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