Prague  - The Czech Republic's inflation slowed down another notch amid falling foreign demand, cooling to 0.2 per cent year-on-year in August, the lowest reading since September 2003, the Czech Statistics Office said Wednesday.

In July, the annual inflation rate stood at 0.3 per cent. Falling food and non-alcoholic beverage prices caused the inflation rate to decline by 0.2 per cent in August compared to the previous month, the office said.

The meltdown on global financial markets skirted the central European country of 10.4 million, but a fall in orders from Western Europe has been troubling the export-driven economy.(dpa)