As regards price developments, according to Eurostat’s flash estimate, annual HICP inflation fell to 1.8% in September 2006, from 2.3% in August. Although no detailed breakdown is available as yet, this relatively sharp decline seems to be the combined result of favourable base effects, given in particular the strong rise in oil prices a year ago, and the recent significant fall in oil prices.
While the outlook for energy prices is uncertain, on the basis of current energy prices and the higher quotations  BIS Review 91/2006  1  on futures markets, overall inflation rates are likely to increase again towards the end of the year and in early 2007.