Eurozone inflation has been gliding gently downwards for the past four months. But some analysts think price pressures will pick back up again this month, which could cause the European Central Bank to adopt a more cautious approach to cutting interest rates.
Consumer prices in the single currency bloc are expected to be 2.5 per cent higher in May than they were a year ago, a slight acceleration from 2.4 per cent a month earlier, according to a Barclays forecast of what the data will show when it is released on Thursday.
“Unfavourable base effects in energy will be the primary tailwind for headline inflation, pushing it to accelerate slightly,” said Mark Cus Babic, an economist at Barclays, adding that services inflation could tick up due to last year’s launch of subsidised German train tickets.