A inflation at euro zone fell more than ever in March, but core price growth accelerated, Eurostat data showed on Friday, likely strengthening the case for further hikes in interest rates. fees for the European central bank.
Consumer prices rose 6.9% in March after an 8.5% rise in February, implying the biggest slowdown since Eurostat started collecting data in 1991.
The drop was due almost exclusively to the retreat in energy prices compared to March last year, when they rose after the invasion of Ukraine for the Russia.
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But an index that excludes energy and food prices, known to economists as core inflation and considered a better indicator of the underlying trend, picked up slightly to 7.5% from 7.4% in February.
Analysts polled by Reuters had expected headline inflation in the 20 countries that share the euro to reach 7.1%, with the core at 7.5%.
After a record series of rate hikes, the ECB held back from committing to further hikes, saying that would depend on the current turmoil in the banking sector easing and data such as underlying inflation.
But several ECB officials, including chief economist Philip Lane, have said recently that further increases in borrowing costs are likely to be needed to bring inflation back to the central bank’s 2% target.
Source: Moneytimes
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