Eurozone inflation rises to 2% in June

Inflation in the Eurozone rose in June, returning to the European Central Bank (ECB) target range, reinforcing expectations that policymakers may move to cut interest rates in the third quarter of this year.

Preliminary data released by Eurostat today, July 1, showed that the annual inflation rate in the Eurozone inched up to 2% in June, from 1.9% in May, in line with expectations.

Meanwhile, core inflation — which excludes energy and food prices — held steady at 2.3%, unchanged from the previous month.

Inflation in the services sector — closely monitored— increased to 3.3%, up from 3.2% in May, though still below the April peak of 4%.

Meanwhile, the pace of food and beverage price increases slowed to 3.1% in June, down from 3.2% in May, while energy prices continued to decline for the fourth consecutive month, falling by 2.7% last month.