Eurozone Inflation Holds Steady at 2.4% in April

The inflation rate in the Eurozone remained steady at 2.4% in April, matching the previous month’s level. This was according to a rapid estimate released by Eurostat, the European statistics office, on Tuesday. The estimate did not include data for the entire European Union.

Thus, the inflation rate in the Eurozone continues to exceed the two percent target set by the European Central Bank (ECB). The ECB initiated interest rate hikes in July two years ago to bring inflation under control. However, it paused the rate hikes in October last year. Since then, it has maintained its base interest rate at 4.50%.

The year-on-year measure of so-called core inflation, which excludes prices of energy, food, alcohol, and tobacco, fell to 2.7% in April in the Eurozone, down from 2.9% in the previous month. This has bolstered expectations that the ECB could start cutting interest rates in June.

This month, the ECB’s Governing Council again left interest rates unchanged at its meeting, in line with expectations. However, it signaled that a reduction is imminent. ECB President Christine Lagarde also hinted that the Eurozone may not wait for the US Federal Reserve to cut its rates.

According to Eurostat estimates, Belgium recorded the highest year-on-year inflation rate among the countries using the euro in April, with consumer prices rising by 4.9%. In contrast, Lithuania recorded the lowest inflation rate, with prices only increasing by 0.4%.

In the Czech Republic, which is not a member of the Eurozone, consumer prices rose by two percent year-on-year in March. Inflation thus remained at the February level. The Czech Statistical Office (CSO) will publish data on the development of inflation in April on May 13.