Euro-zone inflation drops to five-year low at 0.3%


Inflation in the euro zone fell to an almost five-year low of 0.3% in August, down from 0.4% in July, according to preliminary data from Eurostat released on Friday. The data were in line with analysts’ expectations and bring the currency union one step closer to deflation. The threat of falling consumer prices has recently raised calls for the European Central Bank to launch more easing measures, and ECB President Mario Draghi hinted last week at a full-on quantitative easing program to avert deflation. However, ECB sources told Reuters earlier this week that the August inflation reading would have to come in really weak to trigger easing action at the monetary-policy meeting next week. The euro EURUSD, +0.05% rose to $1.3188, up from $1.3178 ahead of the data.


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