A June base rate cut looks increasingly likely for the Eurozone said economists, after inflation slowed to 2.4% in March compared to 2.6% a month earlier.
Excluding food and energy, prices rose by 2.9% over the month, against 3.1% in February.
Euro area annual #inflation at 2.4% in March 2024, down from 2.6% in February 2024 https://t.co/9jqBgGskMG pic.twitter.com/3GJl5SxzvH
— EU_Eurostat (@EU_Eurostat) April 17, 2024
Service inflation remained higher at 4% however, with Pantheon Macroeconomics forecasting a dip in April, making June cut more likely.
“We still see the central bank cutting its policy rates four times this year, in June, July, September and October, with no cuts next year as inflation stays above 2%,” Pantheon said.
“Risks are now balanced around this baseline. If oil prices roar higher through May and June, the ECB won’t be able to cut as much as we currently think.”