Eurozone June inflation slowed more than expected, reducing bets on further ECB rate hikes this year and weighing on the Euro.
The Euro fell to a one-year low against the British Pound after Eurozone inflation data missed forecasts, dampening expectations for another European Central Bank rate increase. EUR/GBP traded at 0.8598, its lowest level since July 2025.
Eurostat reported preliminary June HICP inflation at 2.8% year-over-year, down from 3.2% in May and below the 3.0% consensus. Core HICP eased to 2.4% from 2.5%, while monthly core inflation rose 0.2%, slowing from 0.3% in May. Oil prices near pre-US-Iran war levels added to disinflationary pressures.
ECB policymakers remain cautious, with Joachim Nagel warning inflation will stay elevated through 2027. Traders await remarks from ECB President Christine Lagarde and BoE Governor Andrew Bailey at the Sintra Forum later Wednesday.