The coming week’s ‘flash’ estimate for March consumer price inflation in the euro area may help to further ease concerns about the risk of sustained deflation. The headline annual rate is expected to rise modestly to -0.2% from -0.3% in February, while the ‘core’ rate is likely to be unchanged at 0.7%. The headline rate is likely to return to positive territory later in the year. “Recent activity indicators, including the March ‘flash’ PMIs have pointed to stronger growth in the euro area in early 2014. The European Commission’s measures of business and consumer confidence could provide further evidence of this. Meanwhile, Greek debt negotiations continue. Reports suggest that the Greeks have proposals ready, which may be approved in a Eurogroup finance ministers’ meeting early in the coming week. Lack of significant progress could force the Greek government to take extraordinary measures (possibly including capital controls).” – Lloyds bank said in a report on Friday
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