MNI BRIEF: Inflation Dip Opens ECB Path To Q2 Rate Cut Talks
Euro area inflation fell in January, reversing some of the upside blip seen in December.
Eurozone inflation slowed in January, though the annual headline rate still sat just above November's two-year low, potentially offering ECB policymakers an opportunity to discuss a path to rate cuts, though perhaps not by as early as the March 7 meeting.
Headline inflation slowed to an annual 2.8%, down from 2.9% in December, but above the 2.4% seen in November. Core inflation also decelerated, slowing to 3.3% from 3.4% in December, flash data released by Eurostat on Thursday showed.
The ECB wants to return inflation sustainably to 2%, with projections currently pointing to that happening in mid-2025. However, some policymakers now say the target could be hit by as soon as mid-to-late 2024. (See MNI SOURCES: "Biggest Minority" Favours ECB June Cut)