According to Eurostat, eurozone inflation slowed down to 5.5% from 6.1% amid falling energy prices. Bloomberg reported that inflation in the euro area hit the lowest level since January 2022. At the same time, core inflation, which excludes food and energy prices, accelerated to 5.4% from 5.3% in May. Notably, EU core inflation was cooling down for three months. However, the ECB may increase its key interest rate in June. It can become the ninth rate hike in a row. “There is nothing in this release that would deter the ECB from raising interest rates by another 25 basis points at the meeting in July,” economist Jack Allen-Reynolds from Capital Economics wrote. Eurostat reported that energy prices slumped by 5.6% in June on a yearly basis. Notably, energy lost another 1.8% a month earlier. At the same time, food, alcoholic beverages, and tobacco prices slowed to 11.7% from 12.5%, while industrial goods prices decreased to 5.5% from 5.8%. Meanwhile, services prices soared to 5.4% from 5%. Economists see such a surge as a record high in the eurozone.
