Eurozone inflation eased more than expected in June, reinforcing signs that price pressures are moderating following the recent decline in energy prices. Headline CPI slowed from 3.2% yoy to 2.8% yoy, below expectations of 3.0%. Core inflation, which excludes energy, food, alcohol and tobacco, fell from 2.6% yoy to 2.4% yoy, also below the consensus forecast of 2.5%.
The moderation was broad-based across the major inflation components. Energy inflation slowed from 10.8% yoy to 8.7% yoy as oil prices retreated following the easing of Middle East tensions. Services inflation also cooled from 3.5% yoy to 3.2% yoy, while food, alcohol and tobacco inflation eased from 1.9% yoy to 1.6%. Non-energy industrial goods inflation was unchanged at 0.9%, suggesting underlying goods price pressures remain well contained.
The data are likely to provide reassurance that the recent energy shock has not generated broader second-round inflation effects. With both headline and core inflation surprising on the downside, the figures strengthen the case for the ECB to leave interest rates unchanged at its next meeting while continuing to monitor whether lower energy costs feed further into services inflation and wage dynamics over the coming months.
| Indicator | Previous | Latest | Consensus | Comments |
|---|---|---|---|---|
| Headline CPI (YoY) | 3.2% | 2.8% | 3.0% | |
| Core CPI (YoY) | 2.6% | 2.4% | 2.5% | |
| Energy Inflation (YoY) | 10.8% | 8.7% | ||
| Services Inflation (YoY) | 3.5% | 3.2% | ||
| Food, Alcohol & Tobacco (YoY) | 1.9% | 1.6% | ||
| Non-Energy Industrial Goods (YoY) | 0.9% | 0.9% |
