Eurozone inflation fell by four tenths in August to 2.2%, driven by lower energy prices, putting it very close to the 2% target set by Parliament. European Central Bank (ECB), according to advance data published this Friday by Eurostat. This good result paves the way for the institution led by Christine Lagarde It cut interest rates again at its next meeting on September 12, after pausing in July.
In fact, underlying inflation –which excludes energy, food, alcohol and tobacco, the most volatile items – also fell slightly, from 2.9% in July to 2.8% in August. This is a key structural indicator for the European Central Bank (ECB) when deciding on interest rates.
If we analyse the main components of the Eurozone CPI, services This is the factor that has increased the most in the last year. (4.2% in August, two tenths more than the previous month). Next come food, alcohol and tobacco (up slightly, from 2.3% in July to 2.4% in August).
Prices of industrial products excluding energy slowed down, falling from 0.7% in July to 0.4% in August. Finally, Energy prices down 3% from the previous year, compared to a 1.2% increase in July.
Last June, the ECB made the first rate cut in eight years and left them at 4.25%. A reduction that represented a change in monetary policy after the sharp rise in the price of silver between July 2022 and September 2023, with ten consecutive increases in which it went from 0% to 4.5%. A bullish cycle that was followed by eight months in which rates remained at historic highs.
However, after the first drop in the price of the currency in June, Lagarde decided in July to slow the decline in the price of silver after verifying that Inflationary pressures remained intenseHowever, the latest data on slowing wages and falling inflation in August open the way for the ECB to resume the path of rate cutting.
Most experts expect the Governing Council to cut the silver price by another quarter-point at its September meeting, taking it to 4%. They also expect at least one more cut before the end of the year, probably in December.
