Eurozone inflation 0.7% in October

Inflation across the eurozone fell to 0.7 percent in October, the lowest level in the 17-country currency area for four years, the European Union said on Friday. The 12-month rate of consumer price increases was down from 1.1 percent in September, according to the Eurostat data agency, which said electricity prices had been the main driver of inflation. The announcement confirmed a preliminary estimate of the October inflation rate made by Eurostat in late October. "While this is welcome news for eurozone consumers as it helps their purchasing power, inflation is getting uncomfortably low for the ECB as it is now substantially below its target rate of 'close to, but just below 2.0 percent'," said IHS Global Insight analyst Howard Archer. The European Central Bank last week surprised analysts with an earlier-than-expected cut in its key refinancing interest rate from 0.50 percent to 0.25 percent. According to a new ECB survey published on Thursday, the central bank for the 17 countries that share the euro currency anticipates an annual average of 1.4-percent inflation this year, edging back up to 1.5 percent in 2014 and 1.6 percent in 2015. Eurostat's October figures highlighted divergences between key countries, with Germany's 1.2-percent rate contrasting sharply with 0.7 percent for France and zero inflation in Spain.