Euro area prelim June consumer prices rise 2% y/y; est. +2.0% eurozone CPI (m/m): 0.3% (est 0.3%; prev 0.0%)

Euro area prelim June consumer prices rise 2% y/y; est. +2.0% eurozone CPI (m/m): 0.3% (est 0.3%; prev 0.0%)

June 19, 2025

Euro area preliminary consumer prices rose by 2.0% year-over-year in June 2025, according to data released by Eurostat. This marks a slight increase from the 1.9% recorded in May 2025. The estimated monthly consumer price index (CPI) for June 2025 is expected to be 0.3%, slightly above the previous month's 0.0% reading [2].

The European Central Bank (ECB) has been closely monitoring inflation trends. In June 2025, Germany's annual CPI cooled to 2.0%, aligning with the ECB's inflation target. This development suggests that price pressures across the euro area are under control and supports the ECB's recent monetary policy adjustments [2].

The ECB delivered a 25 basis point rate cut in June 2025, its first in years, signaling a potential pause in policy tightening. This move was partly influenced by the easing inflation trends, including the recent decline in Germany's CPI [3]. The ECB's Vice President, Luis de Guindos, expressed confidence that the institution is on track to meet its 2% inflation target [3].

The Harmonized Index of Consumer Prices (HICP), the ECB's preferred measure of inflation, also declined to 2.0% in June 2025, down from 2.1% in May. This figure came in below market expectations, indicating a faster-than-anticipated easing of inflation [2].

The economic optimism index in the euro area decreased to 94 points in June 2025, from 94.80 points in May. This slight decline in consumer confidence may reflect the ongoing uncertainty surrounding inflation and economic growth [4].

In summary, the euro area's preliminary June consumer prices rose by 2.0% year-over-year, with the estimated monthly CPI at 0.3%. The ECB's recent rate cut and the declining inflation trends suggest that the central bank is adjusting its policy to manage inflation expectations. The broader economic context, including consumer confidence, remains a key factor to watch.

References:
[1] https://www.tradingview.com/news/te_news:466936:0-euro-area-inflation-expectations-fall-in-may/
[2] https://voiceoftraders.com/analysis/germany-annual-cpi-inflation-edges-lower-to-2-in-june
[3] https://www.marketscreener.com/quote/currency/EURO-US-DOLLAR-EUR-USD-4591/news/ECB-on-path-to-meet-its-2-inflation-target-ECB-s-De-Guindos-Says-50351387/
[4] https://seekingalpha.com/news/4463178-economic-optimism-index-in-the-euro-area-eases-to-94-points-in-june