Overview

• Eurozone headline inflation matched the ECB’s 2% objective in July after sliding from over 6% a year ago.
• Germany recorded a cooler-than-expected rate of 1.8%, Italy slowed to 1.7%, France remained at 0.9%, and Spanish inflation is seen jumping to 2.7%.
• Core inflation excluding food and energy stayed at 2.3%, while services price growth eased to 3.1% and goods inflation picked up modestly.
• The ECB halted rate cuts after trimming its key rate to 2% in June and signalled it is in no hurry to adjust policy further.
• A stronger euro, subdued wage growth and US trade barriers are expected to keep price pressures muted in the near term.