The fall in consumer prices in the euro zone narrowed in March but remained in deflationary territory, according to latest figures from Eurostat on Thursday morning.
The inflation rate inched up to a reading of -0.1 percent year-on-year, up from -0.2 percent last month. This was in line with expectations of analysts polled by Reuters. While heading in the right direction, the rate is nowhere near the European Central Bank's (ECB) target of close to 2 percent.
Jonathan Loynes, chief European economist at Capital Economics, said the data confirmed "that price pressures in the currency union remain very weak."
"Admittedly, core (excluding energy and food) inflation rose from plus 0.8% to plus 1.0%, reversing the previous month's decline...But country data already released suggest that this may have partly reflected the early timing of Easter raising inflation in some leisure sectors. As such, the increase could be reversed in April," he warned in a note.
"Looking ahead, euro-zone inflation is likely to remain close to zero in the next few months before edging higher in the second half of the year as negative energy effects finally fade," he added.
The data is the first reading of the region's consumer prices since the ECB's decision earlier this month to increase and expand its aggressive monetary stimulus.