Inflation in the euro area slowed to 2.2% y/y in March

Energy prices decreased by 0.7% over the month

Inflation in the euro area in March 2025 increased by 2.2% compared to the same month in 2024. Thus, the indicator slowed down compared to February, when it was +2.3% y/y. This is evidenced by preliminary data from Eurostat.

The consensus forecast of analysts, cited by Trading Economics, predicted an indicator of +2.3%.

Core inflation, which excludes energy and food costs, rose by 2.4% in March. Energy prices fell by 0.7% after rising by 0.2% in February.

During the month, the member states of the bloc with the highest annual inflation rates were Estonia, Croatia, and Slovakia – +4.3% each. The lowest rates were recorded in France (+0.9%), Luxembourg (+1.5%), and Ireland (+1.8%). In Germany, consumer prices increased by 2.3%, and in Italy – by 2.1%.

The European Central Bank continues to pursue its monetary stimulus policy. In early March, the ECB cut all three key interest rates by 25 basis points for the second time since the beginning of the year. The base deposit rate is 2.5%, the main refinancing operations rate is 2.65%, and the margin loan rate is 2.9%.

According to Eurostat’s preliminary estimates, the EU’s GDP in 2024 grew by 0.8% compared to 2023. In the euro area, this figure increased by 0.7% y/y. In the fourth quarter, seasonally adjusted EU GDP grew by 0.1% compared to the previous quarter, and by 1.1% compared to the same period in 2023. In the euro area, the figure remained at the level of the third quarter and grew by 0.9% y/y.