European inflation rises for first time since 2023

June 18, 2024 02:17 AM PDT | By Invezz

European inflation rises for first time since 2023 — Image source: Invezz

Exceeding expectations

Forecasts from analysts for EU CPI month-over-month figures were broadly at 2.6% for May 2024.

If this were to be the case, it would mean that the slowdown in EU inflation has exceeded the European Commission’s forecasts for the 2024 year.

In a newly updated forecast, the European Commission said last month that inflation “is expected to wind down to 2.7% in 2024 and to 2.2% in 2025.”

As it stands, however, the figures were a marginal disappointment for analysts.

ECB inflation predictions for Europe

The figures were also in line with new projections from the European Central Bank, who released these predictions on June 6^th:

Overall, annual average headline HICP inflation is expected to decline from 5.4% in 2023 to 2.5% in 2024, 2.2% in 2025 and 1.9% in 2026. Compared with the March 2024 projections, HICP inflation has been revised up by 0.2 percentage points in 2024 and 2025. This is mainly due to higher energy commodity prices and slightly higher than expected incoming data for HICPX inflation.”

The European Statistical Monitor

Eurostat also released the European Statistical Monitor, a dashboard with short-term indicators covering different areas, such as economy, environment, business, health and work.

The monthly updated dashboard is designed to track developments within the EU as a whole and its members, providing a holistic overview of key developments.

According to the monitor, EU industrial production picked up from the stagnation observed in March 2024. Despite rises in February and April, the sector has yet to fully recover from the significant fall recorded in January 2024, when production fell to its lowest level since September 2021. This fall contributed substantially to the year-on-year decline in industrial production observed in April 2024.

Meanwhile, the EU unemployment rate remained unchanged in April 2024 compared to the previous month, maintaining historically low levels.

The monitor also noted that EU economic sentiment improved in May 2024, only partially reversing the decline observed in the previous month. The European Commission’s Economic Sentiment Indicator has hovered below its long-term average since July 2022.

The post European inflation rises for first time since 2023 appeared first on Invezz

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