Today the markets received several very important reports on inflation rates from the eurozone. The monthly core CPI and regular CPI (which includes food and energy prices) met the forecasts set at 0.9% and 0.7%, respectively. The year-on-year CPI for April was at 1.7%, but the core YoY CPI was better than expected at 1.3%, which is slightly higher than the expected 1.2%.
The core CPI, especially the YoY one, is a very important indicator in terms of measuring the strength of the economy, and it is one that the European Central Bank is particularly interested in. The fact that the eurozone did not miss any of its inflation targets in the last month is a good sign. However, it is not enough, since a single month cannot accurate reflect all of the economy, especially if you consider that Easter took place in April this year and likely affected spending habits.
The reports were not enough to allow the euro to stabilize. Nevertheless, if we continue to see positive results in the following months, the single currency might finally begin to stabilize.
