Eurozone Inflation Takes a Tiny Step Back
In February, the eurozone’s consumer price index (CPI) dipped from 2.5% to 2.4%, beating the Wall‑street expectation of a 2.3% drop.
Core Numbers Aren’t Tipping Over Either
The “core” part, which strips out the wild food and energy swings, fell from 2.7% to 2.6%. Not a dramatic sliver, but still a sigh‑in‑the‑opportunity‑for‑the‑ECB. Services, the part that’s often the most stubborn, nudged down to 3.7%, finally leaving the 4% cliff edge after close to a year.
Euro Sprints, But Markets Hit the Brakes
After the CPI relief, the euro pushed up a solid 0.6%. Yet trading rooms muted the excitement a bit, wary that Europe’s Central Bank might cut rates again this year. The headline: services inflation falling off the 4% wall, but it’s not a fairy‑tale cure.
Expectations for More Rate Cuts
- The ECB looks set to trim rates three more times this year, ultimately landing at a metaphorical anchor of 2.00%.
- Thursday’s cut is probably the last automatic one.
- Lights are turning on the “restrictive” policy debate – will it still be called that?
- Most experts see a pause next month, as the central bank grips the controls harder.
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