- Prior +2.2%
- Core CPI +2.7% vs +2.5% y/y expected
- Prior +2.4%
The core reading is the standout here and that will add some challenge for the ECB in trying to communicate a rate cut for next month. Traders are pricing in ~86% odds of that currently, largely due to a softening economic backdrop. But with core inflation still yet to actually move towards the brink of 2%, the ECB might find it tough to oversell their narrative at the moment.
This article was written by Justin Low at www.forexlive.com.