Europe's inflation is way down. But hope is gone for a quick interest rate cut






Europe's energy crisis, stemming from the conflict in Ukraine, has eased, but economic growth stagnates amid persistent inflation concerns. While inflation has dipped from its peak, it remains between 2-3%, prompting caution from ECB President Christine Lagarde, who is unlikely to announce an interest rate cut at the upcoming meeting. Analysts anticipate a quarter-point cut by June, with similar prudence seen in the U.S. as the Federal Reserve awaits further evidence of inflation control before considering rate adjustments. Although food and energy prices stabilize, inflation persists in service sectors. Lagarde is expected to stress the need for more evidence of declining inflationary pressures. Despite the ECB's steady rise in the key rate to 4% aimed at curbing inflation, economic growth in the eurozone remains sluggish, with Germany forecasting minimal growth. Pressure for a rate cut mounts, yet the ECB may resist until more data is available to inform its decision-making process.

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