Eurozone inflation rose to 3.0% in April from 2.6% in March, the Eurostat flash estimate confirmed April 30. Energy was the entire driver — up 10.9% versus 5.1% the prior month. [1] Services slowed to 3.0% from 3.2%, food rose to 2.5% from 2.4%, and core inflation actually cooled to 2.2% from 2.3%. The paper's May 5 read called the disinflation glide formally broken on the war premium. The ECB confirmed the same day, holding rates at 2% deposit, 2.15% main refinancing, 2.40% marginal lending. [2]

What changed this week is Brent. The 9-10% pause-day crash to roughly $99.60 reopens the question of whether the energy pass-through can ease enough by June to resume the glide. The April Brent average was $124 — a wartime peak. May spot is $99.60. If the price holds, the energy contribution to euro-area HICP could fall meaningfully by the May or June flash. The mechanical computation is straightforward: energy inflation drops, headline drops, even with services and food sticky.

The ECB's worry is the second-round effect. Christine Lagarde, in her April 30 statement, noted indicators of underlying inflation "have changed little over recent months" and that surveys show selling-price expectations rising. The ECB wage tracker still points to easing labor costs through 2026 — but inflation expectations over shorter horizons "moved up significantly." Q1 GDP was 0.1%, virtually flat. If the ECB hikes prematurely against the energy spike, the eurozone risks a mini-recession in late 2026 or early 2027 — Berenberg's warning to clients last week.

Markets currently price an ECB hike in June. The Brent crash makes that pricing less certain. The hold-tight scenario is now the path of least regret if Brent stays below $100.

-- HENDRIK VAN DER BERG, Brussels