Eurozone Inflation Takes a Gentle U‑Turn
Breaking news from the euro‑zone: inflation climbed to 2.4% in December—exactly what everyone was eyeballing—and core inflation stayed steady at 2.7%. The headline takeaway? Energy prices kept doing their disappearing act, but services inflation shot back up to a sticky 4.0%. A classic recipe for a mixed‑bag economic snapshot.
Why the ECB Still Thinks Twice
- Core inflation is throttling at 2.7% and headline inflation is down thanks to dropping energy costs.
- Despite the dip, economists are treating the uptick in services as a temporary glitch—no hard drilling yet.
- Rate cuts of around 100 bps this year are predicted, though at a slower tempo than market hype.
Services Inflation: The Ticky‑Ticky Challenge
Even with energy prices cooling, services are still throwing a stubborn attitude. Month‑on‑month, services inflation jacked up by a whopping 0.8%—raw material for the hawk‑onters calling for a tighter stance. The ECB’s policy remains fussy: cautious cuts, no knee‑jerk moves.
The Bottom Line
In plain speak: We’re not answering the spirits of a faster rate cut. The ECB will keep its cool eye on services inflation, proving the fiscal mission still needs a dashing turning point.
