German inflation remained tame in September, according to the first regional figures to be released today.
Consumer prices fell 0.1 per cent in the west German states of Bavaria and Hesse, the first of six German states to report price data used to calculate a preliminary pan-German figure expected later in the week.
Analysts said the data were in line with forecasts for German consumer prices to fall by 0.1 per cent on the month, for a year-on-year inflation rate of 1 or 1.1 per cent.
The German data followed figures from Italian cities suggesting consumer prices rose by 0.2 to 0.3 per cent on the month and by 2.8 to 2.9 per cent year-on-year in September, giving a first glimpse of inflation trends in the euro zone for the month.
Euro zone inflation rose to a four-month high of 2.1 per cent in August. European Central Bank officials have said they expect a fall in inflation in the first half of 2004 to below 2 per cent.
Hesse said that year-on-year inflation held steady at 1.0 percent, the same as in August. Bavaria said its year-on-year inflation remained unchanged at 1.3 per cent.