As for the prospects for inflation, on the basis of current commodity futures prices the annual HICP inflation rate is likely to remain above a level consistent with price stability for some time, moderating gradually during the course of 2009.
Taking into account the recent substantial decline in commodity prices, together with the substantial weakening in demand which has emerged lately, upside risks to price stability have diminished. Taking this environment into account and, particularly also the fact that inflation expectations have significantly diminished, the Governing Council has decided to diminish rates by 50 basis points on 8th of October.