According to the official report, consumer price inflation (CPI) in the euro area fell more than forecasts, falling back from a maximum in four years. This reduced the pressure on the ECB to tighten monetary policy.
The report says that the consumer price index (CPI) in the euro area for March rose 1.5% against the previous month, which is below the forecasted value (1.8%) and below the February inflation of 2.0%.
The Eurostat data also showed that on an annualized basis, the March energy price increase reached 7.3% compared to a growth of 9.3% in February. Prices for food, alcoholic beverages and tobacco rose 1.8% in March against a 2.5% increase in February, while service prices rose 1.0% against a growth of 1.3% in February. Prices for manufactured goods, excluding energy prices, increased by 0.2% (the same indicator was recorded last month).
Core inflation, which does not take into account prices for energy, food, alcohol and tobacco, rose 0.7% in March from the same period a year earlier. In February, the growth of core inflation was recorded at 0.9%. Analysts had expected core inflation in March to grow by 0.8%.
Given that the main indicator of inflation fell far below the ECB target (slightly below 2.0%), the calls for a reduction in the financial incentive program (especially from Germany) should weaken.
The next meeting of the ECB Committee on Monetary Policy is scheduled for April 27.
Germany also published its inflation data. In February, retail sales in Germany increased by 1.8% compared to January, according to the Federal Statistical Agency of the country. In the annual terms, the indicator fell 2.1%. The analysts on average predicted an increase in sales by 0.7% per month and by 0.3% per year.
According to the revised data, in January retail sales fell 1% per month and increased by 2.7% in annual terms. Earlier, it was reported that the first indicator fell 0.8% and the second rose 2.3%.
Sales growth last month was the highest since August 2014, when they also increased by 1.8%.
Consumer prices in France, harmonized with the standards of the European Union, in March increased by 1.4% in annual terms, according to preliminary data of the National Statistical Office Insee. Thus, inflation remained at the level of the previous month, and also coincided with the consensus forecast of analysts.