Inflation continued to decline in the euro zone in March, falling to 2.4% over one year, or 0.2 points less than in February, thanks to a lull in food prices, Eurostat announced on Wednesday.
The decline is more marked than expected by analysts interviewed by Factset and Bloomberg. On average, they expected 2.6% and 2.5% respectively.
Inflation is getting closer to the European Central Bank’s (ECB) target of 2%. This trend, if confirmed, could convince the monetary institution to lower its interest rates in the coming months.
The rise in consumer prices in the 20 countries sharing the single currency has been more than quadrupled since the record 10.6% reached in October 2022 when energy prices were soaring in the context of the war in Ukraine.
The figure most scrutinized by the financial markets and the ECB, that of underlying inflation, that is to say corrected for volatile energy and food prices, also sends an encouraging signal.
This indicator, considered more representative, also fell more than expected in March, 2.9% over one year, compared to 3.1% in February. Analysts from Factset and Bloomberg expected an average of 3%.
The lull on the inflation front last month came mainly from a lower rise in food prices. They increased by 2.7% year-on-year against 3.9% in February.
The rise in prices for industrial goods also slowed to 1.1%, compared to 1.6% the previous month.
Prices of services increased by 4% like in February, and like every month since November 2023.
For their part, energy prices continued their downward movement but at a much lower rate (-1.8%, after -3.7%).