The ECB with the lead of President Trichet continued to confirm anchored and subdued inflationary pressure and steady outlook for inflation as the economy recovers from the worst crisis on modern times.

The Eurostat said today than inflation as gauged by the Consumer Price Index -CPI- dropped 0.8% following December's decline of 0.3% while on the year advanced slightly to 1.0% from 0.9% inline with the flash estimate.

Core annual CPI inflation declined more than expected from 1.1% to 0.9% lower than the expected 1.0%. The decline in core readings are merely a reflecting to the rising spare capacity in the economy amid a slow recovery and high unemployment rate with tight lending which is keeping the led on consumer and business spending and holding inflation steady and the outlook stable within the ECB's target range over the medium term.