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Italy Sept EU-harmonised CPI falls to -0.9% y/y, far below forecasts as deflation deepens

Sept 30 (Reuters) - Italian EU-harmonised consumer prices (HICP) rose a preliminary 1.0% month-on-month in September, with prices declining 0.9% from the year earlier, data showed on Wednesday, pointing to deepening deflation.

The 0.9% annual price drop followed an unrevised 0.5% decline in August.

The HICP was far below the median forecast of a 1.4% month-on-month rise, down 0.4% year-on-year in a Reuters survey of 15 analysts.

Official statistics agency ISTAT also reported that the main domestic price index (NIC), was down 0.6% on the month and down 0.5% annually, following an identical 0.5% annual decline in August.

The higher month-on-month reading on the HICP was due to the price rebound following summer discount sales for clothes and footwear. The NIC index excludes items affected by temporary discounts.

Core inflation (net of fresh food and energy) was running at -0.3% year-on-year on the HICP index in September, down steeply from +0.3% in August. ISTAT gave the following preliminary breakdown: The EU-harmonised index (HICP):

Sept August July Monthly change 1.0 -1.3 -0.7 Yr/yr inflation -0.9 -0.5 0.8 Index (base 2015=100) 102.8 101.8 103.1 The NIC index: Sept

Monthly change -0.6 0.3 -0.2 Yr-on-yr inflation -0.5 -0.5 -0.4 Index (base 2015=100) 102.4 103.0 102.7

ISTAT gave the following sector-by-sector breakdown for the HICP in September:

Sector m/m yr/yr

Food -0.1 1.4

Alcoholic drinks, tobacco -0.1 2.0

Clothing 25.4 -2.2

Housing, electricity, fuel 0.0 -3.9

Domestic goods 0.1 0.2

Health spending -0.2 0.0

Transport -2.9 -3.3

Communications -0.2 -6.4

Recreation -2.0 -0.2

Education 0.5 1.2

Hotels, restaurants -0.2 -0.7

Other goods, services 0.3 1.2

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