The Consumer prices rose by around 2.5 percent in the euro area in March. This meant that inflation increased Compared to the previous month by 0.6 percentage points, the EU statistics office said in an initial estimate. The reason for the sharp increase is the increased energy prices as a result of the Iran war.
The Inflation rate is as high as it was last in January 2025. However, it is lower than some analysts expected. Other economists are concerned about the estimate from the Luxembourg-based statistics office. “The massive rise in energy prices catapulted inflation upwards in March. By May at the latest, it should be over three percent, unless the war ends quickly,” says Commerzbank chief economist Jörg Krämer.
Statisticians expect an increase of 4.9 percent in March energy prices out of. The costs for food, alcohol and tobacco rose by 2.4 percent compared to the previous year, and those for services by 3.2 percent.
Inflation in Germany is around 2.7 percent
According to the office, Croatia recorded the highest inflation rate in the euro zone at 4.7 percent. Lithuania and Slovakia are also severely affected by high consumer prices. Price increases were lowest in Cyprus and Italy. For Germany, Eurostat reported inflation of 2.8 percent, the Federal Statistical Office reported in a first estimate to 2.7 percent. This is the highest level in Germany since January 2024.
The head of the ECB, Christine Lagarde, and other central bankers at the ECB recently confirmed that they wanted to wait for the consequences of the Iran war for the time being. Since mid-2025, the key interest rate has remained unchanged at 2.0 percent. However, as soon as clearer effects become apparent, the ECB would raise key interest rates, said chief economist Alexander Krüger from Hauck Aufhäuser Lamp Privatbank. “At a prolonged war The price of crude oil will cause another surge in inflation.”