On the downside, concerns remain relating to a stronger or more protracted negative feedback loop between the real economy and the turmoil in financial markets, renewed increases in oil and other commodity prices, the intensification of protectionist pressures, more unfavourable than expected labour market conditions and, lastly, adverse developments in the world economy stemming from a disorderly correction of global imbalances.
With regard to price developments, annual HICP inflation was, according to Eurostat’s flash estimate, -0.6 % in July, compared with -0.1% in June. This further decline in annual rates of  BIS Review 96/2009  1  inflation was anticipated and reflects primarily base effects resulting from the peaks observed in global commodity prices a year ago.