The hawkish views of monetary policies from central banks around the world are taking a hit and the financial markets have started reprising it, facing with softer than expected inflation readings across globe amid a fresh decline in many of the commodities.
This week’s readings from across Europe provided enough evidence to suggest that inflation is once again slowing down after a spike earlier this year.
- Readings today from France showed that inflation declined to 0.9 percent, which is the weakest level in five months.
- German inflation reached a four year high of 2.2 percent in February, however the latest reading has shown that inflation declined to just 1.4 percent in May. The reading was weaker than the median consensus of 1.6 percent.
- Inflation in Spain has moderated to 2 percent in May from 3 percent earlier this year.
- Inflation in Italy declined from 2 percent in April to just 1.5 percent in May.
The Eurozone inflation declined from 1.9 percent in April to just 1.4 percent in May. While weaker inflation somewhat relieves the European Central bank (ECB) from German pressure to adjust interest rates, it has a new headache that its policies are struggling to boost inflation.


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