After a record streak of rate rises, the ECB has refrained
from committing to more hikes, saying this will depend on
whether the current turmoil in the banking sector subsides and
on data including underlying inflation.
But several ECB policymakers including chief economist Philip
Lane have said recently that more increases in borrowing costs
are likely to be needed to bring inflation back to the central
bank's 2% target.
(Reporting By Francesco Canepa; Editing by Catherine Evans)
FRANKFURT, March 31 (Reuters) - Inflation in the euro
zone dropped by the most on record in March but growth in core
prices accelerated, Eurostat data showed on Friday, likely
strengthening the case for more interest rate hikes by the
European Central Bank.
Consumer prices rose by 6.9% in March after an 8.5% increase
in February, implying the biggest deceleration since Eurostat
started collecting data in 1991.
The fall was almost exclusively due to a drop in energy
prices compared to March last year, when they had surged in the
wake of Russia's invasion of Ukraine.
But an index that excludes energy and food prices, known by
economists as core inflation and seen as a better gauge of the
underlying trend, accelerated slightly to 7.5% from 7.4% in
February.
Analysts polled by Reuters had expected headline inflation
in the 20 countries that share the euro to come in at 7.1% and
core inflation at 7.5%.
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