In the euro area, the year-on-year rate of increase in the core CPI declined to 0.8 percent in April, the lowest since the introduction of the index. These developments in the United States and Europe imply that the deterioration in the aggregate demand and supply balance in these economies has been exerting downward pressure on prices.
The same factors have impacted on the annual growth rate of the narrow monetary aggregate, M1, which increased from 7.1% in March to 8.7% in April. The growth of loans to the private sector continued to be weak.