Eurozone inflation held steady in November, while core inflation weakened unexpectedly, strengthening the case for additional stimulus from the European Central Bank as early as Thursday.

Inflation came in at 0.1 percent, the same rate as seen in October, flash data from Eurostat showed Wednesday. This was the second consecutive rise in consumer prices.

Economists had forecast inflation to rise to 0.3 percent. Headline inflation has been below the ECB’s target of ‘below, but close to 2 percent’ since early 2013.

According to the ECB forecast, inflation is unlikely to return to 2 percent until 2017.

Excluding energy, food, alcohol and tobacco, core inflation eased to 0.9 percent from 1.1 percent a month ago. It was forecast to remain at 1.1 percent.

ECB Chief Mario Draghi hinted at more stimulus in October and reiterated his stance on November 20. He said the bank will act, using all the instruments available to reach its inflation goal.

The ECB is set to announce the outcome of its monetary policy meeting tomorrow.

Peter Vanden Houte, an economist at ING Bank NV, said the ECB will cut the deposit rate by at least 15 basis points tomorrow and extend both size, scope and duration of its asset purchase program.

The bank launched its EUR 1.1 trillion asset purchase programme in March, which is set to run until September 2016.

The headline inflation rate will rise quite sharply in the next few months on the anniversary of more big falls in oil prices a year ago, Jonathan Loynes at Capital Economics said. But the slack in the economy and generally subdued cost pressures would likely continue to keep core price pressures contained, the economist added.

The cost of food, alcohol and tobacco rose at a slightly slower pace of 1.5 percent and that of energy plunged 7.3 percent. Non-energy industrial goods prices and services costs gained 0.5 percent and 1.1 percent, respectively.

Another report from Eurostat showed that producer prices continued its downward trend in October, largely due to falling energy prices.

Producer prices decreased 3.1 percent in October from last year, which was slower than the revised 3.2 percent decline posted in September. Prices were expected to fall 3.2 percent. The decline for September was revised from 3.1 percent drop.

Likewise, producer prices dropped 0.3 percent month-on-month after decreasing revised 0.4 percent in September. Economists had forecast producer prices to ease 0.4 percent.

The material has been provided by InstaForex Company – www.instaforex.com