Euro zone inflation falls

The call for a further cut in euro zone interest rates has gathered pace as inflation has fallen by the most since the implementation of the euro as the single currency over 10 years ago.

According to the European Union’s statistical office, inflation across the 15-euro nations had fallen to 2.1 percent from 3.2 in November.

Despite the euro zone being in recession, jobless rates rising and the gross domestic product falling, it is not all doom and gloom as it is hoped that due to falling energy costs, inflationary pressures are subsiding.

Unemployment across the euro zone has risen to 7.7 percent, an increase of 0.1 percent from September.

Germany is the only nation who has steadied job losses, although the nation still experienced 7.1 percent unemployment.

European Central Bank (ECB) lawmakers have little to worry about regarding deflation, as it is only a continued fall in prices that will have a severe negative impact on the economy.

An interest rate cut of 0.5 percent is expected shortly as the ECB governing council meets this week with the aim to keep inflation close to the 2 percent benchmark figure.

European confidence has fallen to a 15-year low in November as retail sales fell the most in at least five years and it seems as though it is difficult to forecast anything past a struggle for 2009.

The euro remained lower against the dollar, down 0.4 percent at $1.2859.

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