Eurozone inflation up to 0.4 pct in September

Eurozone annual inflation in September rose to 0.4 percent, up from 0.2 percent in August, official data showed on Monday.

In the 28-member bloc European Union(EU), annual inflation was also 0.4 percent in September, up from 0.3 percent in the previous month, said Eurostat, the statistics agency of the EU.

A year earlier the rate was minus 0.1 percent in both zones.

According to Eurostat, negative annual rates were recorded in Bulgaria, at minus 1.1 percent, followed by Croatia with minus 0.7 percent and Slovakia with minus 0.5 percent.

The highest annual rates were observed in Belgium at 1.8 percent, followed by Estonia and Austria.

Compared with August, annual inflation fell in nine EU countries, remained stable in two and rose in 16.

The largest upward impacts to euro area annual inflation came from restaurants and cafes, as well as rents and tobacco, while fuels for transport, gas and heating oil had the biggest downward impacts.

Realizing that the continued reduction in energy price deflation was the key driver of higher eurozone inflation last month, economists predicted that further upside is likely.

Claus Vistesen, Chief Eurozone Economist of Pantheon Macroeconomics, said deflation has been vanquished in the eurozone economy.

"Inflation will remain below the European Central Bank's target in the near term, but bond yields are creeping higher ... we think, that deflation is yesterday's cyclical story in the Eurozone economy," he said. Enditem