Eurozone: February should have marked the peak for inflation this year - HSBC

The research team at HSBC suggests that February should have marked the peak for inflation this year as long as Eurozone is concerned.

Key Quotes

“Annual headline inflation bounced back to 1.9% y-o-y in April (chart 29) from 1.5% in March, as core inflation shot up to 1.2% and service inflation reached the highest rate in over four years.”

“The recent inflation rollercoaster seen in the eurozone due to base effect of energy, colder-than-usual winter and the timing of Easter should be nearing an end. February (2%) should have market the peak, whilst headline inflation should fall until June.”

“Market inflation expectations, measured by the 5y5y forward rate, have fallen back to levels not seen since November 2016, when the annual headline inflation print was just 0.6%.”