Euro zone September producer price decline steepest since January

BRUSSELS (Reuters) - Euro zone industrial producer prices fell by slightly less than expected in September, but still recorded the steepest annual decline since January due to even lower energy prices.

The European Union's statistics office Eurostat said prices at factory gates in the 19 countries sharing the euro decreased by 3.1 percent year-on-year in September, and by 0.3 percent compared to August.

The former decline was the steepest since January and will provide little comfort for the European Central Bank in its fight against super-low inflation.

The data were still not as low as the forecasts of minus 3.3 and minus 0.4 percent respectively. Last month, producer prices were down by 2.6 year-on-year and 0.8 percent month-on-month.

Energy prices decreased by 0.8 percent month-on-month and were 9.8 percent lower than a year earlier. Prices of durable consumer goods decreased 0.1 percent on a monthly basis and rose by 0.8 percent year-on-year.

Excluding volatile energy prices, producer prices were down 0.2 percent in September and were 0.6 percent lower than a year earlier.

Prices charged by industrial producers are an early indication of consumer inflation trends, because changes typically affect prices charged in shops.

The European Central Bank wants to keep inflation below, but close to 2 percent in annual terms over the medium term and is buying assets including euro zone government bonds to inject more cash into the economy and accelerate price growth.

Consumer price inflation was minus 0.1 percent in September and zero in October.

Concerned that its 1 trillion euro plus asset and bond buying plan may not be bringing the desired effects quickly enough, the ECB has signaled it might unveil new stimulus measures at its December meeting.

(Reporting By Philip Blenkinsop; editing by Robert-Jan Bartunek)

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