In 1998 and 1999, consumer prices rose by only 1.1 per cent; in the year 2000, the inflation rate, at 2.3 per cent, ran a little above the two-per cent ceiling in the wake of the sharp increase in oil prices. This year, after peaking in May at 3.4 per cent, the inflation rate has been decreasing.
In October, prices were 2.4 per cent higher than a year before. In the current environment of a weak world economy, the ECB Governing Council is expecting a further moderation of price increases. At its meeting on November 8, the Governing Council therefore decided to cut rates by half a percentage point.