Inflation falls in Germany, Italy and the U.K.

CPI reports from Germany, Italy and the U.K. showed that inflation dropped in October, providing further strength to those who believe that central-bank policy should continue to be accommodative. In Germany, CPI slowed to the lowest rate since August 2010, easing to +1.2% on year from +1.4% previously. Italian inflation edged down to +0.8% from +0.9%. In both countries, CPI shrank on month. In Britain CPI weakened to +2.2% from +2.7% and dropped closer to the Bank Of England's target of 2%.