Eurozone Services Slowdown: What This Disinflation Signal Means for Your Investments and Business Growth
“On the positive side, services inflation continued its downward trajectory, falling to a 40 month low of 3.1%. The decline in services inflation is proceeding somewhat faster than our expectations, but it is consistent with the normalisation we have seen in wage growth and will be welcomed by the ECB. In contrast, goods inflation surprised to the upside, rising to a 16 month high of 0.8%, although this remains a benign figure. If anything, we expect goods inflation to face renewed downward pressures over the coming months, as weaker demand from the US on the back of tariffs, as well as from more intense competition from Chinese goods – something the ECB recently published a blog post about.”
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