Germany’s headline inflation edged up to 2.9 % in April, just below the 3.1 % forecast, while Spain slipped to 3.2 % from 3.4 %. The lower‑than‑expected rises weaken pressure on the European Central Bank to raise rates before June.

Energy prices, the main driver, climbed 10.1 % in Germany and were cushioned in Spain by a €5 bn energy‑tax cut launched after the Iran conflict. Economists now view a modest ECB tightening around June as more likely than an April rate hike, with core inflation slipping to 2.3 % from 2.5 % for households and businesses alike.

Disruptions at the Strait of Hormuz, through which a fifth of global oil passes, continue to feed inflationary pressure. Analysts foresee the ECB holding rates steady at Thursday’s meeting but pricing in three quarter‑point rises by year‑end, pushing the deposit rate to 2.75 %, the highest since February 2025 and signal a cautious stance amid volatile energy markets.

With core euro‑zone inflation projected at 2.9 % in April and GDP growth nudging 0.2 % in Q1, the data endorse a delayed rate hike. Investors can expect the ECB to delay tightening until at least June, aligning policy with the muted inflation trajectory for stability longer.