While in August prices in euro-paying countries fell by 0.2 percent year on year, the September deflation was even tenth of a percentage point deeper. According to Eurostat, the main culprit is energy prices, which fell by more than eight percent year on year.
Year-on-year inflation, as measured by the change in the harmonized index of consumer prices, reached -0.3 percent in the euro area in September. Compared to August, however, prices increased by 0.1 percent. Nevertheless, this was not enough to prevent the eurozone from sinking into even deeper deflation than in August, when prices fell by 0.2 percent year on year.
The price level is mostly driven down by energy prices, which fell by 8.2 percent year on year. Other industrial goods also fell in price, but by only 0.3 percent. On a month-on-month basis, prices of services fell the most, depreciating by more than one percent.
In terms of individual countries, prices fell the most in Greece year-on-year, by 2.3 percent. The price level also fell by less than two percent in Cyprus, and prices in Russia and Estonia also depreciated over one percent. On the other hand, prices rose the fastest in the euro area in Slovakia, where they gained 1.5 percent year on year.
