"Inflation across the eurozone eased to 2% in December, edging down from November's 2.1% pace and landing on the European Central Bank's long-term target. This reflects a broad cooling in goods prices and continued restraint in energy costs, while services inflation remains the main source of underlying momentum. The key takeaway is that price pressures have normalising after several turbulent years. Policymakers remain wary of declaring victory too soon. Wage pressures, shifts in global energy markets and uneven demand across member states"
"However, with headline and core inflation now moving in a relatively narrow band, the ECB faces fewer immediate triggers to adjust interest rates. The ECB is unlikely to cut interest rates further - unless there is a deep slump in the European economy - meaning it will aim to keep borrowing costs steady in the coming months while closely monitoring the direction of travel."
Inflation across the eurozone eased to 2% in December, down from 2.1% in November, aligning with the European Central Bank's long-term target. Goods prices broadly cooled and energy cost restraint continued, while services inflation remained the main source of underlying momentum. Wage pressures, shifts in global energy markets and uneven demand across member states continue to pose risks to the outlook. With headline and core inflation moving in a relatively narrow band, the ECB faces fewer immediate triggers to change interest rates and is unlikely to cut rates absent a deep economic slump. Stable prices provide relief to households and firms, but economic momentum remains fragile.
Read at London Business News | Londonlovesbusiness.com
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