The estimates from analysts are siding with the view that inflation fell once again in the euro area in January. For the German reading itself, headline annual inflation is expected to fall to 3.0% - down from 3.7% in December.
This should reaffirm the declining trend seen last year and will be a welcome development for the ECB. The central bank has already teed up rate cuts for the months ahead, although the debate between April and June remains. But if anything else, a softer set of inflation numbers will afford them the flexibility to act early if needed.
I mean, the euro area Q4 GDP data this week was dour at best. And the more sluggish conditions look set to continue to Q1 this year.
The main question for the ECB is whether or not they would prefer to wait on wages data. That might only come in May, so a rate cut in April could be taken off the table as a result.
But either way, as long as the inflation trend stays the course, policymakers can breathe a little easier and focus more on the economy instead for the time being.
Here's the agenda for today:
- 0630 GMT - North Rhine Westphalia
- 0900 GMT - Hesse
- 0900 GMT - Bavaria
- 0900 GMT - Baden Wuerttemberg
- 1000 GMT - Saxony
- 1300 GMT - Germany national preliminary figures
Do note that the releases don't exactly follow the schedule at times and may be released a little earlier or later.
