Inflation 1.8 in Sept vs 2.2 in Aug
Markets betting on Oct, Dec rate cut from ECB
Energy, goods prices the biggest drag on inflation
Services price pressures also easing a touch

FRANKFURT, Oct 1 Reuters Euro zone inflation dipped below 2 for the first time since mid2021 in September, reinforcing an already solid case for a European Central Bank rate cut this month as a threeyear battle to tame runaway price growth nears its end.

Inflation in the 20 countries sharing the euro currency eased to 1.8 in September from 2.2 in August, Eurostat data showed on Tuesday, coming below expectations for 1.9 in a Reuters poll, primarily on falling energy costs and muted goods prices.

A more closely watched figure on underlying prices referred to as core inflation, meanwhile, dipped to 2.7 from 2.8 on slower services price growth, coming below expectations for 2.8.

Price growth has been above the central bank39;s target for years now with surging energy costs, production bottlenecks in the post pandemic reopening, corporate opportunism and copious fiscal support all lifting inflation to over 10 by late 2022.

But a record string of interest rate hikes from the central bank has tamed price growth relatively quickly, and policymakers are now debating just how fast they should ease borrowing costs.

The ECB has already reduced rates in June and September, and ECB President Christine Lagarde sent the clearest signal yet on Monday that another cut may come later this month given…