In the Euro Area, inflation was set at 1.8% on an annual basis in September. As a result, the Region’s inflation dropped below the ECB’s 2% target for the first time since 2021. The slowdown in inflation has raised expectations for interest rate cuts from the ECB. The Consumer Price Index (CPI) in the Euro Area was determined at 1.8% on an annual basis in September. The European Statistics Office (Eurostat) published preliminary inflation data for September in the Euro Area. According to the data, the annual inflation rate in the Euro Area, which was 2.2% in August, fell to 1.8% in September. The CPI was -0.1% on a monthly basis in September. Market expectations also pointed towards an annual inflation rate of 1.8% in the Euro Area for September. The reported data matched market expectations. Looking at the main components of inflation, the highest annual price increase was seen in services at 4%. The service sector was followed by food, alcohol, and tobacco products at 2.4%, non-energy industrial products at 0.4%, while energy products declined by 6%. Core inflation in the Euro Area was measured at 2.7% on an annual basis and 0.1% on a monthly basis in September. According to Harmonized Index of Consumer Prices (HICP) data, inflation in September was 4.5% in Belgium, 3.3% in the Netherlands, 3.2% in Estonia, 3% in Greece and Croatia, 1.8% in Germany, 1.7% in Spain, 1.5% in France, and 0.8% in Italy. On the other hand, the European Central Bank (ECB) targets inflation at 2% in the medium term. The slowdown in inflation has reinforced expectations that the ECB will continue with interest rate cuts.