Full Breakdown
Eurozone Inflation Drops to 2.8% in June, Easing Price Pressures
7/3/2026, 12:46:59 PM
Eurozone Inflation Drops to 2.8% in June
Preliminary Eurostat data show the euro area consumer price index (CPI) at 2.8 % in June, down from 3.2 % in May. Core inflation, which excludes energy, food, alcohol and tobacco, fell to 2.4 %. The moderation was broad-based, with energy prices easing sharply. Country-level rates varied: Malta recorded the lowest annual inflation at 1.9 %, while France, Estonia and Germany were at 2 % and 2.4 % respectively; Lithuania (5.5 %), Bulgaria (5.3 %) and Croatia (4.2 %) posted the highest rates.
Background & Context
May’s inflation rise was driven by a surge in energy costs linked to geopolitical tensions in the Middle East. In June, the energy price rebound slowed, allowing overall inflation to retreat. The European Central Bank (ECB) responded by raising its key interest rate by 25 basis points in June—the first hike since September 2023—bringing the rate to 2.25 %. The bank also revised its medium-term inflation outlook.
Key Data and Statistics
- CPI (June): 2.8 % (May: 3.2 %)
- Core inflation: 2.4 % (May: 2.6 %)
- Energy inflation: 8.7 % (May: 10.8 %)
- Food inflation: 1.6 %
- Services inflation: 3.2 %
- Non-energy industrial goods inflation: 0.9 % (stable)
- Lowest national rates: Malta 1.9 %, France 2 %, Estonia 2 %, Germany 2.4 %
- Highest national rates: Lithuania 5.5 %, Bulgaria 5.3 %, Croatia 4.2 %
Official Statements & Responses
The ECB announced a 25-basis-point increase to 2.25 % and updated its macroeconomic projections, now forecasting average inflation of 3 % in 2026, 2.3 % in 2027 and 2 % in 2028. Core inflation is projected at 2.5 % in 2026, 2.2 % in 2027 and 2.2 % in 2028. The bank signaled that, given the recent slowdown, it is likely to keep rates unchanged at its next policy meeting on 23 July.
Verbatim Quotes
- “2% in May and below expectations, according to the preliminary estimate published by Eurostat, the statistical office of the European Union (EU).” — Consejeros Editorial Team
- “The data reinforced expectations that the European Central Bank would not raise interest rates again at its next meeting, after having raised them last month for the first time since 2023.” — QNA
What’s Next
The ECB’s July 23 meeting will determine whether the current 2.25 % rate is maintained. Analysts will watch energy market developments and the inflation trajectory in the euro area’s largest economies—France, Germany and Italy—for cues on future monetary policy.
