Prices dropped 7.8 % from a year earlier after falling 4.6 % in June. That’s the biggest decline since the office started to calculate the series in 1949 and exceeded economists’ forecast for a 6.5 % drop, depending to the median of 21 estimates.

The price of crude oil has dropped more than 50 % from a record in July 2008, while weaker demand is also weighing on inflation. The European Central Bank, which has cut its benchmark interest rate to a record low of 1 percent, has downplayed the threat of deflation in the euro-region economy.

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