Germany’s inflation rate remained stable in February, reinforcing expectations that the European Central Bank (ECB) could cut interest rates next week. According to Destatis, Germany’s consumer prices rose 2.8% year-over-year, unchanged from January’s level, based on EU-harmonized figures.

Similar trends were observed in Italy and Spain, where inflation also held steady. However, France’s inflation rate dropped significantly, falling from 1.8% to 0.9%, which may provide ECB policymakers with enough confidence to proceed with another rate cut.

On a national measure, Germany’s inflation rate remained at 2.3%, while core inflation, which excludes volatile food and energy prices, fell to 2.6% from 2.9%. This decline in core inflation signals easing price pressures, adding to the case for monetary policy easing.

The ECB has already cut its deposit rate four times in a row, and with inflation trends stabilizing or declining, another rate reduction seems increasingly likely in its upcoming policy meeting.

While a rate cut would provide relief for borrowers, some policymakers remain cautious, warning that inflation risks could re-emerge if energy prices rise or wage growth accelerates. However, with the broader eurozone economy struggling, the ECB may feel pressured to ease monetary conditions further.

Markets are now closely watching ECB signals ahead of its March meeting, where investors expect further policy adjustments to support economic growth.