The eurozone's July inflation rate was revised down to minus 0.7 per cent, European statistical office Eurostat said Friday, highlighting the persistence of weak demand in the 16-member bloc, according to dpa. Eurostat's preliminary estimates had pointed to a rate of minus 0.6 per cent - still the biggest decline in the eurozone inflation in more than a decade. Annual inflation in the 27-member European Union was estimated at 0.2 per cent in July, down from 0.6 per cent in June. Friday's figures came a day after Eurostat published estimates showing that the eurozone remained stuck in recession in the three months leading to June, with gross domestic product (GDP) shrinking by 0.1 per cent on the previous quarter. However, better-than-expected performances by Germany and France suggested that the worst of the downturn may soon be over. Both economies posted positive GDP rates of 0.3 per cent after four consecutive quarters of negative growth. Eurozone GDP had plummeted by 1.8 per cent in the last quarter of 2008 and by 2.5 per cent in the first quarter of 2009. Istat said the July drop in inflation was in part due to declining food and energy prices. The components with the lowest annual rates were transport (minus 5.5 per cent), housing (minus 1.8 per cent) and food (minus 1.0 per cent). By contrast, the highest annual rate was observed in the alcohol and tobacco category (4.4 per cent). The eurozone country with the lowest inflation figure was Ireland (minus 2.6 per cent), while the highest was Finland (1.2 per cent).
