4 March 2025 Eurozone Monitor ECB hawks have a strong case for arguing this week's cut is the last

• The ECB will cut its policy rates by 25bp, but the argument for further easing is now much tougher. 
• February inflation data mean the ECB’s forecast for Q2 inflation at 2.1% is now a Hail Mary. 
• ECB doves will focus on downside risks to growth and employment from tariffs; they have a point.

Claus Vistesen (Chief Eurozone Economist)Eurozone

EZ Datanote: Advance Inflation, Germany, February 2025

In one line: Consistent with a below-consensus EZ print on Monday.

Claus Vistesen (Chief Eurozone Economist)Eurozone

EZ Datanote: ECB Consumer Inflation Expectations, EZ, January & Unemployment, Germany, February

In one line: EZ inflation expectations ease back; further increases in German unemployment are on the way.

Melanie Debono (Senior Eurozone Economist)Eurozone

EZ Datanote: State CPIs, Germany, February

In one line: Consistent with the national CPI undershooting the consensus.

Claus Vistesen (Chief Eurozone Economist)Eurozone

PM Datanote: Advance Inflation & INSEE Consumers' Spending, France, Feb/Jan

In one line: Inflation pulled lower by energy, but the core softened too; setback in spending after a strong finish to 2024.

Claus Vistesen (Chief Eurozone Economist)Eurozone

EZ Datanote: Retail Sales, Germany, January 2025

In one line: On track for a slowdown in Q1. 

Claus Vistesen (Chief Eurozone Economist)Eurozone

3 March 2025 Eurozone Monitor EZ inflation likely undershot the consensus in February

• Eurozone headline and core inflation likely undershot the consensus in February.
• Today’s data should be the first clear sign that EZ services inflation is now falling, from a trend of 4%.
• EZ consumers’ spending on goods saw a slow start to 2025, but don’t write off Q1 just yet.

Melanie Debono (Senior Eurozone Economist)Eurozone