Part 4/8:
In addition to GDP growth, the Eurozone inflation report released recently showed a year-on-year inflation rate of 2.2% for April. This figure, while slightly above forecasts, remains close to the European Central Bank’s (ECB) target of 2%, indicating that the central bank may have room to cut interest rates in response to future economic pressures. This contrasts sharply with the situation in the U.S., where inflation and trade dynamics complicate the Federal Reserve's monetary policy.
The decline in energy prices significantly contributed to this disinflation, with a noted 3.5% decrease in energy costs. Historically, high energy prices have posed major challenges for Europe, underscoring the importance of lower energy costs for European industrial competitiveness and inflation stability.