A woman takes a selfie with the Eiffel Tower in the background on Rue Soucouf in Paris on July 23, 2024, ahead of the 2024 Olympic Games in Paris.
Mauro Pimentel | AFP | Getty Images
Preliminary data released by statistics agency Eurostat on Friday showed that euro zone inflation fell to a three-year low of 2.2% in August.
July’s decline was 2.6%, in line with forecasts by economists polled by Reuters.
The core rate, which excludes volatile components such as energy, food, alcohol and tobacco, fell to 2.8% in August from 2.9% in July, also in line with the Reuters survey.
Prior to this, prices in Germany, the largest economy in the euro zone, increased. The temperature drop exceeded expectations to 2% This month, calculated based on Eurozone harmonized data.
Economists at ING expect euro zone core inflation to remain above 2.5% for the rest of the year due to the stickiness of goods and services.
After the European Central Bank announced a 25 basis point interest rate cut in September, the market has fully priced in the institution’s pricing. First interest rate cut in Juneand cut interest rates by another 25 basis points before the end of the year.
Ballinger Group foreign exchange market analyst Kyle Chapman (Kyle Chapman) said that some details in the press release will still worry ECB policymakers, especially the 4.2% services industry inflation rate.
“The positive news is purely due to the impact of energy prices, which masks the fact that there has been little real progress on the underlying pressures,” Chapman said in a note.
“Services inflation is currently at its highest level since October, has been at 4% for nearly a year, and has been moving in the wrong direction since the spring.”
This is a breaking news story and will be updated soon.
