€ inflation details – Will the core rate drop soon?
In July, inflation in the euro area remained above the ECB's target when excluding energy, food, alcohol and tobacco on a month-on-month basis.
Commerzbank Economic Research
08/20/2025
The core rate remains above ECB target
According to final figures from Eurostat and the ECB, consumer prices in the euro area excluding energy, food, alcohol and tobacco (core rate) rose by 0.24% in July compared with June, after seasonal adjustment. This means that the official core rate is above the average for the previous three months.
Adjusting the core rate using our preferred seasonal adjustment and for the effects of volatile services does not change this result, as these two effects cancel each other out. Accordingly, the core rate adjusted for these one-off effects settled above the ECB's target in July. However, we show below that even this adjusted rate is likely to be distorted by high goods prices. This fuels hopes that the core rate is likely to fall in the coming months.
For full text see attached PDF-Version.
