BRUSSELS, Nov 30: Eurozone inflation hit 3.0 per cent for the third month running in November, official data showed on Wednesday, but analysts expect the European Central Bank to slash its main rate due to the debt crisis.

The ECB, the guardian of euro price stability, wants to keep inflation below 2.0 per cent but any action when bank governors meet on December 8 could be driven by concerns about a looming eurozone recession.

Although the Eurostat data agency said inflation stood at 3.0 per cent in November, economists expect the ECB to cut its benchmark rate by 0.25 points to 1.0 percent in light of the worsening crisis.

“Although Eurozone consumer price inflation remained up at 3.0 per cent in November, there is a very strong case for the ECB to cut interest rates again at its December 8 policy meeting,” said Howard Archer, chief economist at IHS Global Insight. The ECB had already cut its rate to 1.25 per cent earlier in November, just five months after having raised it to 1.50 per cent. With banks in desperate need of liquidity, analysts say the ECB can afford to cut the rate because inflation is expected to ease to 2.0 per cent in 2012.

“All in all, the current and foreseeable downturn in economic conditions will probably significantly ease pressures on wages, costs and prices, increasing downside risks to price stability,” said Clemente De Lucia, economist at BNP-Paribas.

“The conditions have clearly come together for further monetary policy easing from the ECB. The ECB could deliver another interest rate cut at next week Governing Council meeting,” De Lucia said.

The crisis has also prompted calls for the ECB to act as a lender of last resort to rescue distressed eurozone nations, but Germany and the bank itself oppose printing money, saying it was up to governments to fix their finances. —AFP