The initial estimate of the Euro Zone Consumer Price Index is set to print at 1.0% in the year to February, down from 1.1% in the previous month. While the weight of deepening recession on price growth has certainly been dramatic, it is important to note that an upside surprise is possible this time around. Last week, we saw estimates of German CPI tick higher than forecast in February (1% vs. 0.8% expected), which may push the overall EZ figure higher. Importantly, the validity of the German result is suspect: the estimate is derived from regional CPI results from six German states, four of which reported technical problems in February and will recalculate their findings. This means that traders are unlikely to pay much attention if tonight’s reading should come in higher. On balance, the trajectory in Euro Zone inflation is certainly pointing lower as the European Commission expects the collective regional Zone economy will shrink -1.9% through 2009, a record low since the introduction of the single currency. The European Central Bank is expected to cut interest rates by 50 basis points to 1.50% later this week .