Economic sentiment set for boost

EU STABILITY and growth pact reforms, a cut in interest rates and falling German inflation are set to combine to provide an uplift to economic sentiment in the coming weeks.

Inflation in Germany fell unexpectedly in November, according to preliminary figures released yesterday, giving the European Central Bank (ECB) plenty of latitude to ease interest rates next week.

Preliminary consumer price data from the six key German states indicates inflation has dropped by 0.4% in November from last month, leaving the annual rate at 1.1%, down from 1.3% in October against a background of forecasts of a rise in inflation rates.