Live Updates > Live Update Details
2026-05-29 19:14:29
[Iran Conflict Pushes Up Prices, Eurozone Inflation Has Not Yet Peaked, ECB Rate Hike Almost a Certainty] ⑴ Preliminary data released on Friday showed that inflation in the four major Eurozone economies exceeded the European Central Bank's 2% target for the third consecutive month in May, with rising fuel costs triggered by the Iran conflict beginning to spread to other commodity prices. ⑵ French inflation rose from 2.5% to 2.8%, Italian inflation rose from 2.7% to 3.2%, Spanish inflation remained stable at 3.2%, while data from most German states that have reported inflation declined. Germany implemented fuel discounts in May and June to mitigate the impact of rising gasoline prices. ⑶ Spain and Italy both reported significant increases in transportation and entertainment prices, likely a chain reaction of rising fuel costs. Fresh food prices in France jumped 4.1%, and service sector inflation rose slightly. ⑷ Institutions expect the Eurozone's overall data to be released on Tuesday to show a 3.3% overall inflation rate in May, and a 2.4% core inflation rate excluding energy, food, alcohol, and tobacco. Core inflation indicators in both Italy and Spain have risen. (5) Economists say inflation has not yet peaked and expect Eurozone inflation to rise until August, with its future largely dependent on the situation in the Middle East. The baseline scenario is that the situation will normalize by the end of June. (6) Since the end of April, hopes for a ceasefire agreement between the US and Iran have driven oil prices down sharply, with Brent crude falling from $118 to $92 per barrel, but still well above the pre-war level of around $70. Continued deflation in French manufacturing suggests that this round of inflationary shocks should be smaller than those in 2022.
