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Eurozone March flash HICP Y/Y inflation came in at 2.18%, 0.02 hundredths below the rounded consensus of 2.2% (vs 2.32% February). On a monthly basis, Eurozone inflation came in at 0.61% (0.6% cons, 0.43% prior). The data on services in the release should be seen as a good sign regarding tapering stickiness in the category.

• Core HICP printed below consensus, at 2.41% Y/Y and 0.95% M/M (2.5% cons; Feb 2.57% Y/Y, 0.55% M/M).
• Looking at the individual categories:
  • Services inflation notably decelerated to 3.42% Y/Y; rounded to 1dp, there has not been a print lower than 3.4% since April 2022. The median sellside analyst estimate ahead of the national data stood at 3.5% - so that looks like a bit of a downside surprise.
  • Energy came in at -0.74% Y/Y, with the deceleration vs February's 0.19% underpinned by a sequential fall (M/M at -1.17%) - this looks broadly in line with expectations.
  • Non-energy industrial goods printed 0.63% Y/Y, the category has remained between 0.44% and 0.70% since last May and this broadly in line with analyst consensus.
  • Food, alcohol and tobacco inflation, as expected, accelerated in March, at 2.90% Y/Y, above February's 2.66% but also broadly line w/ expectations.
• Looking at the national-level prints, headline HICP inflation accelerated in 7 countries in March vs Feb (Netherlands, Austria, Estonia, Latvia, Malta) despite the overall decrease in headline.

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