French inflation turns negative in February - Spanish consumer prices extend their falls - German CPI also in minus territory. As David Pollard reports, it adds up to even more pressure on the ECB for decisive policy action.
Spring may be in the air - it may not be smelling of roses for the ECB. In a triple dose of data, French inflation unexpectedly turned negative in February for the first time in a year. Spain registered its sharpest fall in prices since October. And the euro zone's biggest economy, Germany: there too it's negative. The problem, says IHS Global Insight's Jan Randolf - energy prices. (SOUNDBITE) (English) IHS GLOBAL INSIGHT, DIRECTOR OF SOVEREIGN RISK, JAN RANDOLPH, SAYING: "The lower and longer we have these oil prices, the longer the wash-out period. But fundamentally we have to look at real demand, consumption and investment to see whether there's going to be any improvement in the inflation outlook. It's slowly beginning to happen, but the medium-term outlook is still a concern." There is an upside. (SOUNDBITE) (English) IHS GLOBAL INSIGHT, DIRECTOR OF SOVEREIGN RISK, JAN RANDOLPH, SAYING: "Where is the locomotive for global growth if it's not going to be China any more, which it has been for so many years? I think ultimately, fundamentally, there will be this powerful shift of purchasing power from energy producers to energy consumers, and that is where we're going to see global growth come from." But to round off what could be a perfect data mini-storm for the ECB, euro zone economic sentiment fell by more than expected this month. Consumers too seen as less optimistic in that survey. The ECB's widely expected to cut its deposit rate on March 10. The size of the bond-buying scheme - currently 60 billion euros a month - could be extended by anything from 10 billion-30 billion euros, according to analysts. Although some of those are already asking whether that will be enough.