#euro-area-hicp

#euro-area-hicp

U.S. equity markets delivered a strong performance over the past week, supported by improving geopolitical sentiment and renewed investor confidence, with all major indices recording gains exceeding 3%.

When planning our budgets, we tend to focus on cutting costs. Yet, sometimes a little strategic spending can help to save money in the long term, by reducing our regular expenses and replacing repeat purchases of single-use items.

The BRC cautioned that the Easter uplift, which arrived earlier than usual this year, fell short of what retailers had been banking on, leaving many in no mood to celebrate as April's cost pressures begin to bite.

The orthodoxy across much of the world has been that only markets should decide what things cost, as argued by influential economists like Friedrich Hayek.

Drivers will feel some short-term relief as petrol and diesel prices edge lower, and markets are reacting strongly to the pause. But oil remains elevated, and that continues to feed through the entire economy, into prices, business costs and investment decisions.

"Even with a ceasefire in place, the supply side is fragile. The logistical and insurance uncertainties mean that prices are likely to remain elevated for the remainder of the year."

"The start of the year has been extremely sluggish for German industry," said Elmar Voelker, an analyst at the bank LBBW, noting that "the fleeting hopes of a recovery that had emerged last autumn have evaporated for now."

The conflict has driven up the price of oil and natural gas; damaged oil refineries, tanker terminals and other energy infrastructure; disrupted shipments of fertiliser that the world's farmers depend on; and damaged the confidence of businesses and consumers.

Services experienced the highest annual increase at 3.4%, followed by food, alcohol, and tobacco at 2.5%. Non-energy industrial goods saw a more modest increase of 0.7%. Meanwhile, energy prices fell by 3.1% over the month, which helped to temper overall inflation pressures.

Markets remain fragile amid persistent geopolitical tensions in the Middle East, which have pushed oil prices higher and revived concerns about inflation in Europe. While interest rates are expected to remain unchanged, attention could turn to the ECB's forward guidance and assessment of energy-driven price risks.

The European Central Bank (ECB) held its key interest rates unchanged following the February meeting of the Governing Council, in line with Cebr projections. This marks the fifth consecutive hold, despite a below-target inflation reading of 1.7% in January, the lowest level since 2021. The decision to hold rates also comes despite a recent Euro rally against the dollar, which is expected to add disinflationary pressure through cheaper imports and weigh on growth by making the bloc's exports more expensive.

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