Eurozone May preliminary CPI +8.1% vs +7.7% y/y expected

• Prior +7.4%
• Core CPI +3.8% vs +3.5% y/y expected
• Prior +3.5%

Inflation Inflation Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Read this Term in the euro area hits a new record and that continues to heap pressure on the ECB to act while contesting their viewpoint on whether gradual rate increases will be enough to tackle such stubbornly high price growth.

The upside surprise here has been well telegraphed by the strong readings from Spain, Germany, and France prior to the release.

As price pressures continue to keep higher, that will present more worries surrounding the economic outlook in the region in the months ahead. In turn, that may very well see the ECB's window to normalise policy become narrower. The euro's fate will depend on the resolve of policymakers in the months ahead.