Eurozone inflation fell for the second month in a row in March to 2.2%

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Eurozone inflation fell for the second month in a row in March to 2.2 per cent, as ECB rate-setters contemplate whether or not to gradual the tempo of rate of interest cuts.

Tuesday’s determine was beneath February’s studying of two.3 per cent and in line with the expectations of economists polled by Reuters.

The annual inflation determine continues to be greater than the ECB’s medium-term goal of two per cent. However rate-setters at the central financial institution consider that a rise in headline inflation since the autumn was short-term.

February’s preliminary determine of two.4 per cent was later revised down by 0.1 share factors.

The financial institution has signalled that it might gradual the tempo of its charge cuts due to the inflationary dangers posed by the looming commerce battle sparked by US President Donald Trump, in addition to elevated spending on defence and infrastructure.

Final month, the central financial institution minimize charges for the sixth time since final summer time to 2.5 per cent. However it burdened that “financial coverage is changing into meaningfully much less restrictive”, wording that advised a extra hawkish stance.

ECB president Christine Lagarde additionally warned final month that policymakers had been going through “exceptionally excessive” uncertainty. She added that this made it “unimaginable” to assure that “headline inflation will all the time be at 2 per cent”.

Earlier than Tuesday’s launch, monetary markets had been pricing in a likelihood of roughly 75 per cent of one other quarter-point minimize at the subsequent ECB assembly on April 17, in accordance to ranges implied by swaps markets.

That is a growing story