European Inflation Falls Sharply on Easing Energy Costs, Offers Budget Relief

• European inflation fell to 2.6% in February from a peak of 10.6% in October 2022 after Russia invaded Ukraine • Food inflation eased to 4% from 5.6%, offering some relief to lower income groups • Energy prices fell by 3.7% as oil and gas prices moderated • Core inflation, excluding food and energy, was 3.1% - the lowest since March 2022 • The drop brings inflation closer to the ECB’s 2% target ahead of an expected rate cut in June