Euro area annual inflation dropped to 1.9% in May 2025, marking a significant decline from 2.2% in April and falling below the European Central Bank's 2% target for the first time in over three years. The broader European Union (EU) inflation rate also eased to 2.2%, down from 2.4% the previous month, according to the latest data released by Eurostat, the EU's statistical office.
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This continued downward trend reflects a marked improvement from a year earlier, when inflation stood at 2.6% in the euro area and 2.7% in the EU. Among Member States, the lowest annual inflation rates were observed in Cyprus (0.4%), France (0.6%), and Ireland (1.4%). The highest rates were recorded in Romania (5.4%), Estonia (4.6%), and Hungary (4.5%).
Month-on-month, inflation remained stable at 0.0% across both the euro area and the EU, underscoring broader disinflationary momentum.
Eurostat highlighted the drivers of this latest easing:
'In May 2025, the highest contribution to the annual euro area inflation rate came from services (+1.47 percentage points, pp), followed by food, alcohol & tobacco (+0.62 pp), non-energy industrial goods (+0.16 pp) and energy (-0.34 pp).'
Of the 27 EU Member States, inflation fell in fourteen, was unchanged in one, and increased in twelve. Notable national movements include France's inflation falling to just 0.6%, and Germany easing to 2.1%. In contrast, inflation in Estonia and Romania remains well above the EU average.
This data supports expectations of continued price stability across much of the eurozone. A flash estimate for May, released earlier on 3 June, had predicted the euro area inflation rate at 1.9%, which the final figures have confirmed.
The next flash estimate, offering a preliminary look at June 2025 inflation figures, is scheduled for release on 1 July 2025.
More information;
Eurostat
www.ec.europa.eu