From Morningstar: 2025-06-03 07:49:00

Eurozone inflation fell to 1.9% in May, meeting expectations and marking the first time in years it dropped below the 2% target. Core inflation also decreased to 2.3%, supporting predictions of further rate cuts by the ECB this week.

Food, alcohol, and tobacco prices increased by 3.3%, while service prices slowed to 3.2% in May. Energy remained stable at -3.6%, supporting expectations of continued disinflation in the eurozone.

Wages in the eurozone are growing at a slower pace, leading to predictions of “service disinflation” in the coming months. This, coupled with weak demand and falling price expectations, may bring core inflation closer to 2% by the end of the year.

The ECB is expected to cut rates at its monetary policy meeting on June 5, following recent reductions in April. Economists predict another 25 basis points cut this week, with further easing expected in response to economic headwinds and trade war concerns.



Read more at Morningstar: Eurozone Inflation Falls Below ECB Target in May