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Euro area inflation eases slightly in June, ECB gets more flexibility

June headline inflation rose 2.8% year over year, down from 3.2% in May, while monthly headline inflation was -0.1% as energy prices fell faster.

Reported · Written up by our desk · Inflation

Eurostat confirmed euro area inflation estimates for June without changes, showing easing price pressures even as the ECB weighs its next policy move. Forexlive reports headline inflation was 2.8% year over year in June, matching the preliminary estimate and down from 3.2% in May.

The release also showed a softer monthly picture. Forexlive said the monthly estimate for headline inflation recorded a -0.1% reading, helped by energy price inflation dropping to -1.8% from a higher prior pace.

Core inflation also cooled, according to the same data. Forexlive reported June core CPI came in at 2.4% year over year, unchanged versus the initial estimate, with services inflation falling to 3.2% from 3.5% and food inflation to 1.5% from 1.9%.

The softer inflation trend gives the ECB added room to wait over the summer before deciding on policy again, Forexlive said, while flagging risks that renewed Middle East tensions could lift oil and gas prices and re-ignite inflation pressures later in the season.

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