Published June 18^th 2025

May Eurozone HICP: Eases Amid Seasonal Noise

Headline inflation dipped to 1.9% year-on-year in May, confirming a continuation of the disinflation trend. Core inflation fell more sharply, down to 2.3%, with the decline concentrated in services.

The drop in services inflation—from 4.0% to 3.2% year-on-year—was largely due to a reversal of April’s Easter-related boost to travel and holiday prices. Airfares and package holidays saw notable month-on-month declines. A late Pentecost further suppressed May readings, pushing some seasonal demand into June.

Core goods inflation was flat at 0.6%, consistent with the steady trajectory observed over recent months. Stripping out volatile components, smoothed measures of core and services inflation both edged lower, reinforcing the view that underlying price pressures are easing.

The data also show a deceleration in monthly core inflation, with the April–May average coming in softer than the Q1 pace, even after adjusting for calendar effects.

On the energy side, headline inflation will likely face some upward pressure in the near term due to the recent rise in Brent prices. However, the pass-through is expected to be limited to headline, with no change to the core inflation outlook.