Europe’s inflation drops to 2.2%, setting the stage for ECB rate cut in September

Posted on September 9, 2024   |  

Inflation in the 20 eurozone countries fell to 2.2% in August, down from 2.6% in July, which may lead to an ECB rate cut.

Energy prices decreased by 3% in August, contributing to the lower inflation rate.

Germany's inflation rate dropped to 2%, aligning with the eurozone’s overall trend.

The August inflation rate is close to the ECB’s 2% target, which is considered ideal.

The ECB is expected to lower its key rate by 0.25 percentage points to 3.5% in its September 12 meeting.

The U.S. Federal Reserve will also likely reduce its rates from 5.25%-5.5% at its September 17-18 meeting.