Spain inflation hits zero for first time in four years
AFP · 13 Nov 2013, 12:31
Published: 13 Nov 2013 12:31 GMT+01:00
- Stiff competition keeps lid on Spanish inflation (30 Apr 13)
- Inflation eases on back of cheaper fuel (12 Apr 13)
Spain's inflation rate, a measure of the rise in consumer prices, slowed by half a percentage point from the previous month to zero in October, the National Statistics Institute said.
That figure was harmonized with the European Union's own data. Spain's own non-harmonized figure, which serves as its reference, indicated a negative inflation rate of 0.1 percent in October.
The slowing of the rise in consumer prices in the euro zone's fourth-biggest economy mirrored slowing inflation rates in Germany and several other European countries.
Overall inflation in the eurozone slowed to 0.7 percent in October, its lowest rate since 2009.
In Spain the underlying inflation rate, which strips out the effect of volatile prices for goods such as energy, reached an even lower level of 0.2 percent compared to the same period a year earlier.
The statistics institute said the slowing of inflation in Spain, which is timidly emerging from a two-year recession, was led by lower prices in communications, transport, education, food and alcoholic drinks.
Economists warn that if the trend continues and prices actually start to fall overall and in a lasting way, the economy can slow in a vicious cycle known as deflation.
The European Central Bank defines price stability as increases of just below 2.0 percent in its harmonized inflation yardstick.
The bank's chairman Mario Draghi warned last week that the euro zone might be facing a prolonged period of low inflation, but said he did not foresee deflation.
Spain last saw deflation in 2009, when prices fell for eight months in a row.