Eurozone Inflation Drops Below ECB Target

Eurozone inflation dropped to 1.8% in September, the lowest level in over three years and below the European Central Bank's (ECB) target of 2%. This decline, attributed to falling energy costs and muted goods prices, raises expectations for quicker interest rate cuts by the ECB, which has already reduced rates in June and September. Core inflation also eased slightly to 2.7%, indicating a broader slowdown in price growth. The recent inflation reading was lower than analysts' predictions and highlights the ECB's challenges in balancing inflation control with economic growth. ECB policymakers are now considering the timing and extent of potential further rate cuts, with a meeting scheduled for October 17. Meanwhile, Finnish ECB policymaker Olli Rehn emphasized the need for reforms to ensure long-term economic competitiveness, warning of potential recession risks if negative factors converge.