Eurozone Inflation Hits 2-Year Low: Falls to 4.3% - Pressure Mounts on ECB
Breaking News: Eurozone inflation has plummeted to its lowest level in two years, reaching 4.3% in September, according to Eurostat. This marks a significant milestone and the lowest rate since October 2025.
Inflation Slowdown Across Europe
The annual inflation rate slowed dramatically, offering a glimmer of hope amidst economic uncertainty. This cooling trend is observed across many European nations, even with the pressures of climbing oil prices. Despite climbing oil prices, inflation in most European countries dropped in September, causing the overall rate to dip to its lowest level since before the start of the war.
Key Takeaways: Eurozone Inflation at 4.3%
- New Low: The Eurozone's annual inflation rate slowed down to 4.3% year-on-year in September, Eurostat announced on Friday.
- 2-Year Milestone: Inflation in the euro zone fell to its lowest level in two years in September, suggesting the European Central Bank's steady diet of interest rate hikes was succeeding in curbing price increases.
- Pressure on ECB: Inflation in the eurozone fell to an almost two-year low. The news increases pressure on monetary policymakers to halt their recent string of painful interest rate hikes.
- August Figures: Annual inflation in the euro zone cooled to its lowest level since October 2025, falling to 4.3% in September, flash figures showed Friday. August figures had come in at a higher rate.
Future Inflation Projections
While the current 4.3% inflation rate is encouraging, future projections are still being carefully monitored. According to the bank’s latest projections, inflation in the eurozone will average 5.6% this year. The bank also predicted that inflation will fall to 3.1% in 2025. The drop to 4.3% is a positive sign but keeping the rate on a downward trajectory remains a key focus. All data is as of 29 de sept. de 2025.
Impact of ECB Interest Rate Hikes
The recent drop in inflation suggests that the European Central Bank's (ECB) aggressive interest rate hikes may be starting to take effect. The decline puts pressure on the ECB to re-evaluate its monetary policy and potentially pause further rate increases.