Eurozone inflation falls below target to 1.9%

Eurozone inflation fell below the European Central Bank’s 2 per cent target in May for the first time in seven months, as it considers a further cut to interest rates this week.

May’s annual inflation reading of 1.9 per cent was down from April’s 2.2 per cent figure and below analyst expectations of 2 per cent in a Reuters poll.

It was the first time annual Инфлацията беше под 2 -процентовата цел от септември, когато за малко спадна до 1,7 на 100, откакто надвиши задачата за повече от три години.

Еврото се измъкна при незабавна търговия след публикуването на данни във вторник, с 0,3 % в деня при 1,141 $.

ECB ще актуализира инфлацията на инфлацията и ще вземе идващото си решение на лихвените проценти в четвъртък. The central bank predicted in March that inflation in the currency area would hover above its medium-term 2 per cent target this year, before falling to 1.9 per cent in 2026.

Before Tuesday’s inflation numbers, financial markets had priced in another quarter-point cut in the ECB’s benchmark interest rate on Thursday to 2 per cent — the lowest level in more than two years and half the level in June 2024, when the central bank started to reduce rates.

Such a move would mean the ECB was “entering the final stages of its rate-cutting cycle ”, Konstantin Veit, a portfolio manager at Pimco, wrote in a note to clients.

“Underlying cost pressures continue to dissipate, with wage pressures easing somewhat faster than previously expected, ” said Veit, adding that lower energy prices and a stronger euro could also drag down инфлация.

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