German September prices 1.6% ↑...ECB likely to cut interest rates in October

Germany's consumer price growth fell below its target of 2.0% for the second consecutive month, the preliminary tally showed.

Inflation in major eurozone economies has been caught quickly and recession fears have continued, increasing the likelihood that the European Central Bank and the ECB will speed up interest rate cuts.

Germany's Federal Statistics Office said on the 30th local time that consumer price growth rose 1.6% this month compared to a year ago.

Consumer price growth in major eurozone economies this month was 1.2% in France, 1.5% in Spain and 0.7% in Italy, all below ECB targets as well as expert forecasts.

The market, however, is more sensitive to the possibility of a recession than to prices.

A series of indicators pointing to a downturn last week raised the possibility of a rate cut in October, which the market had initially expected to skip, to about 80% and a rate cut by 0.49 percentage points by the end of the year.

The ECB cut its benchmark interest rate twice in June and mid-month ahead of the United States.

ECB President Christine Lagarde also made remarks weighing in on the prospect of an early rate cut.Speaking to the European Parliament, President

Lagard said: "The latest developments strengthen confidence that inflation will return to its target in due course. We will consider this at the next monetary policy meeting in October," he said.