Inflation in Germany and France slowed in December, official data showed today, likely cementing the European Central Bank's view that interest rates remain at the correct level.
Annual inflation in Germany, Europe's top economy, came in at 1.8%, according to preliminary data from the Destatis statistics agency.
It was down from 2.3% in November and a steeper fall than analysts had expected.
The inflation rate for the whole of 2025 was 2.2%, Destatis said.
Under the "harmonised" metric favoured by the ECB, consumer prices also slowed more than anticipated, to 2% from 2.6% in November.
December's slower inflation was driven by easing energy, food and goods costs.
In France, the euro zone's second-biggest economy, annual inflation eased to 0.8% in December from 0.9% in November due to a steep fall in energy prices, according to the INSEE statistics agency.
Under the harmonised rate, consumer prices rose 0.7% in December, slowing from a 0.8% increase in November.
The ECB, which sets interest rates for the 21 countries that use the euro, targets an inflation rate of 2%.
Inflation for the whole euro area was 2.1% in November. A preliminary estimate for December will be published tomorrow, with analysts expecting the rate to ease.
Franziska Palmas, senior Europe economist at Capital Economics, said the latest data will not change the picture for the ECB.
"The bar for ECB officials to change their policy stance currently appears quite high and December's inflation figures will probably confirm their view that rates are in a good place," she said.
The ECB has held its key deposit steady at 2% for four meetings in a row with inflation hovering around target.
In Ireland, inflation rose by 2.7% in the 12 months to the end of December, according to a flash estimate for inflation published by the Central Statistics Office today.
