The European Central Bank is expected to cut its key interest rates this week for the first time since September 2019. This will mark the end of the record-fast rate hiking cycle begun during the COVID-19 pandemic to combat high inflation. Eurozone inflation came in slightly higher than expected in May at 2.6%, and core inflation at 2.9%. ECB officials say a single rate cut is consistent with their stance, but more cuts in July are not very likely. Domestic inflation, especially in services, remains persistent in the euro area.