This is supported by the declining inflation among service providers, Lane told the Spanish newspaper “El Confidencial” (Monday edition). Both April’s inflation data and first-quarter economic growth data “reinforce my confidence that inflation will return to target in a timely manner.”
The inflation rate in the euro area is currently 2.4 percent, which is close to the target of two percent that the ECB is aiming for. There were also indications of a decline in inflation in the previously sharp rise in service prices. “As of today, my personal confidence has improved compared to our meeting in April,” Lane said, noting that there are more important dates to come in the coming weeks.
The ECB has announced a rate cut on June 6th. The prerequisite for this is that the new economic data signals that the inflation rate will return to its two percent target by the middle of next year.
