The 17-member eurozone consumer price inflation rate rose to 3% in the 12 months to September, up from 2.5% in August.

This represents the largest increase in consumer prices in almost three years. Economists were expecting a rise of 2.5%.

Under normal circumstances, the European Central Bank (ECB), which has a target inflation rate of 2%, would respond through a hike in interest rates.

On the other hand, the weakness of the eurozone’s economies and the sovereign debt crisis call for a reduction in interest rates.

However, during its meeting on Thursday, the ECB left its official interest rates unchanged for the third month in a row.

Measures to assist banks in difficulty were also announced.

In a surprise move, the Bank of England (BoE)’s monetary policy committee voted to expand its asset purchase programme by £75 billion to protect Britain’s ­economy from the eurozone debt crisis and nurture the weak ­recovery.

The decision to purchase assets underscores the weakness of Britain’s economy in the face of slowing global growth, government spending cuts, tax increases and consumers battling with high inflation and slow wage growth.

In its rate-setting meeting the BoE also decided to keep the UK interest rates on hold at the record-low of 0.5%.

The plunge in global stocks during the past few months implies that the markets are pricing in a double dip recession.

Recent ­economic data from the US seems to suggest a more benign outcome.

After the upward revision in the US’s second-quarter GDP reported the previous week, the Institute of Supply Management figures published last week showed that its Manufacturing Purchasing Managers index rose 51.6 in September, up from 50.6 the previous month slightly above market expectations of 50.5.

These figures eased concerns of a slump in manufacturing.

This article was compiled by Bank of Valletta plc for general information purposes only.