(Reuters) – A key market gauge of long-term euro zone inflation expectations fell below 2% on Monday as recession fears boosted expectations that inflation might be peaking soon.
Concerns about a possible recession coupled with a view among investors that aggressive monetary tightening will help tame inflation in the longer term, have pushed down market inflation gauges in Europe.
The five-year, five-year breakeven forward fell to 1.9898%, its lowest since March, below the 2% target of the European Central Bank.
(Reporting by Stefano Rebaudo, editing by Dhara Ranasinghe)