Eurozone inflation expected to reach 2% year on year, with core inflation stable at 2.3%.

From Morningstar: 2025-06-26 06:53:00

Eurozone inflation data for June is expected to show headline inflation rising to 2% year on year, in line with the ECB’s target. Core inflation is forecast to remain at 2.3%, indicating stability. Service inflation was the main driver of headline inflation in May, with energy prices contributing negatively.

Energy prices in Europe rose by 15% following the Middle East conflict but have since fallen. Analysts predict further potential increases if tensions escalate. Price movements could boost year-over-year inflation by 0.4% or up to 1.8% in an extreme scenario. Eurozone inflation is expected to remain around 2%.

The ECB’s next monetary policy meeting is on July 24, with over 50% expecting another rate cut this year, potentially in September. President Lagarde emphasized a ‘data-dependent’ approach, suggesting a pause for now. Lower interest rates could provide modest upside potential for equity markets post-April rally.



Read more at Morningstar: Eurozone Inflation: What to Expect From June’s CPI Data