Eurozone inflation rose to 0.9pc

Brussels: Eurozone inflation rose to 0.9 per cent in November from a four-year low of 0.7 per cent in October, and rose one per cent across the 28-nation European Union, according to Eurostat.

It is mainly due to continuation of fall in energy prices in November, down 1.1 per cent after a drop of 1.7 per cent in October, while food, drinks and alcohol rose 1.6 per cent, compared with a gain of 1.9 per cent.

The debt crisis has savaged growth and jobs in the 17-nation single currency eurozone, with government austerity policies sucking demand out of the economy.

Inflation has fallen steadily as a result – it ran at 2.2 per cent in November 2012 – and October’s reading had sparked a flurry of concern that deflation, or falling prices in real terms, was looming.

Deflation is a key risk as it encourages consumers to put off buying goods in the expectation that if they wait, they will become cheaper.