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2023/05/26 / Erste Group Research

Inflation should fall slightly in May

Next week (June 1), a first flash estimate of Eurozone inflation for May will be published. We expect a further slight decline in inflation in May and expect all major components (energy, food and core inflation) to contribute to this decline.

In the case of core inflation, the price dynamics for goods in particular should continue to fall rapidly, after a clear decline in producer prices has already been observed for some time. In contrast, we expect only a slow decline in the momentum of services prices. The services sector continues to benefit from catch-up effects after the end of the pandemic.

In the short term, therefore, the development of services inflation will remain in focus from a monetary policy perspective. For the situation to ease, a stable and sustained decline in services inflation in the Eurozone in the coming months would be important.

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General information

AuthorErste Group Research
Product nameWeek ahead
Topic in focusMacro/ Fixed income
Economy in focusEurozone, United States
Currency in focusEuro, US Dollar
Sector in focus-