Germany’s inflation slows in June to match ECB’s 2% target

Bloomberg reports that German inflation unexpectedly cooled in June and matched the European Central Bank’s target for the first time in almost a year.

Consumer prices in Germany rose 2% from a year earlier, with the May figure standing at 2.1%. Economists polled by the news agency had forecast price growth to accelerate to 2.2%. 

At the same time, inflation ticked higher in Spain and France, while holding steady in Italy. The overall eurozone figure is due on Tuesday. Analysts at Bloomberg Economics project it to come in at 2%, slightly up from 1.9% in May.

Ireland's central bank governor Gabriel Makhlouf says the region's inflation outlook is favorable over the near-to-medium term, with price growth expected to settle at around 2%.

ECB policymakers are likely to take a pause in cutting interest rates at the next meeting in July, as they are more worried about a slowdown in the bloc's economy rather than inflation. Vice President Luis de Guindos says eurozone GDP growth could be virtually flat in the second and third quarters.