Expert: Eurozone inflation hits July 2021 low

Expert: Eurozone inflation hits July 2021 low

According to a report by www.tagesschau.de,

Inflation in the euro area has weakened significantly due to the sluggish economy and the tightening policy of the European Central Bank. Most recently, it reached its lowest value since July 2021. According to an initial estimate, consumer prices in November were 2.4 percent above the level in the same month of the previous year; in the previous month they were 2.9 percent.

Despite fluctuations in energy and food prices in core inflation, this value is a good indicator of the general inflation trend. The experts expect that the European Central Bank (ECB) will take a break from interest rates due to the weak economy and the already sharp decline in price pressure. The strategy of raising interest rates ten times in a row to combat the massive price surge is showing initial success. The inflation rate is approaching the ECB's medium-term target of 2.0 percent.

The impact of this development could have a massive impact on the financial industry and the market. Lower inflation rates could mean that the ECB could reconsider its tightening stance, which could in turn impact the investment decisions of companies and consumers. Additionally, lower inflation could help interest rates remain low, which could have a positive impact on borrowing and consumption.

However, it remains to be seen how inflation will develop in the coming months and whether the ECB will adjust its interest rate policy accordingly in order to achieve the medium-term inflation target.