Eurozone inflation remained at 2.4% in April

In April 2024, inflation in the euro area rose by 2.4% y/y, unchanged from March. This is evidenced by preliminary data from Eurostat.

Analysts polled by Trading Economics also expected inflation in the euro area to remain at the level of the previous month.

In April, core inflation, which excludes energy and food costs, slowed to the lowest since February 2022 at 2.7% (2.9% in March 2024).

In April, the bloc member states with the highest annual inflation rates were Croatia (4.7%) and Belgium (4.9%), while the lowest rates were recorded in Lithuania (0.4%) and Finland (0.6%).

According to Euronews, inflation data for April may provide the basis for the European Central Bank’s first rate cut in June 2024. However, further caution may be required if monthly headline and core inflation rates remain at these levels in May and beyond. Such sustained levels could potentially impede or even pause the ECB’s rate-cutting cycle.

The seasonally adjusted GDP of the euro area and the European Union in January-March 2024 increased by 0.3% quarter-on-quarter. In the fourth quarter of 2023, the eurozone economy fell by 0.1% q/q, while the EU remained stable.

As GMK Center reported earlier, Fitch Ratings has raised its global GDP growth forecast for 2024 by 0.3 percentage points compared to the previous forecast to 2.4%. Expectations for the eurozone were revised to 0.6% from 0.7%.