2  BIS Review 103/2009  Annual HICP inflation in August was less negative than in July. We expect inflation rates to move into positive territory within the coming months, mainly driven by past developments in energy prices. But following the increase this autumn, inflation rates are projected to remain at relatively subdued levels in 2010.
This reflects the gradual economic recovery we expect to see in the course of next year. Both the ECB staff projections for inflation and growth have been revised slightly upwards since June. However, uncertainty remains high. The improvements we have seen over the past few months have in part been driven by the fiscal stimulus.