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Q&A: Prices fall but ‘it is not deflation’

By Ralph Atkins in Frankfurt

Published: June 30 2009 17:07 | Last updated: June 30 2009 17:07

Eurozone annual inflation has turned negative, does that mean deflation?

No, at least not if you accept European Central Bank terminology. It defines deflation as a protracted period when prices fall. Tuesday’s numbers showed consumer prices were lower than a year before, mainly because of falls in energy prices. “Core” inflation, which strips out volatile food and energy prices, was in positive territory.

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