August's inflation figures showed a fall for the fourth consecutive month in Italy. National statistics institute ISTAT said consumer prices rose a preliminary 2.8% year-on-year in August, the lowest annual rise since March, and down from July's 2.9%.

Consumer inflation peaked at 3.1% in April but has been falling consistently ever since and analysts expect the trend to continue. The figures provide more ammunition for those that are pushing for the European Central Bank to reduce interest rates in the Euro zone.

The ECB will meet on Thursday when any rate changes will be considered. The slowdown of the German economy in the second quarter along with declining price pressures could prompt a positive decision for a cut.

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