This development was in line with previous trends, i.e. it was mainly due to lower annual percentage changes in the prices of food and a further reduction in energy prices. On balance, the general environment continues to suggest that there is no significant upward or downward pressure on prices in the short term. The pattern of risks to price stability has remained broadly unchanged.
On the one hand, downward pressures could materialise if import or producer prices were to fall further, while, on the other, wage developments would become a matter of concern if wage increases were higher than expected. In addition, any relaxation of fiscal policies would negatively affect the price climate as well as the credibility of the Stability and Growth Pact.