Cooling Eurozone Inflation Opens Path for ECB Rate Pause

Inflation in the eurozone declined to a 15-month low in May, opening a window for the European Central Bank to pause its aggressive interest-rate increases, the Wall Street Journal reported. The data is unlikely to deter the ECB from increasing rates by another quarter percentage point at its June 15 policy meeting, but it could tee up a pause over the summer. Major central banks including the Federal Reserve are trying to judge if and when to halt rate increases as inflation declines and economic growth slows. A pause would give central bankers time to assess the impact of their recent historic policy actions, which have exacerbated financial-sector strains and caused pain in part of the global economy. The European Union’s statistics agency said consumer prices in the eurozone were 6.1% higher in May than a year earlier, a decline from the 7% rate of inflation recorded in April. Read more. (Subscription required.)