Inflation in the 20-nation eurozone has risen faster than expected in May. But the European Central Bank is still expected to cut interest rates at a June 6 meeting.

Consumer prices in the eurozone rose 2.6% in May year on year compared to 2.4% in April, according to European Union statistics, a figure that surpasses the 2% target aspired to by the European Central Bank (ECB).

Despite the higher-than-expected rise announced by the EU’s statistics agency, Eurostat, the ECB is still expected to cut interest rates next week.

The central bank aggressively hiked rates starting in July 2022 as inflation soared after Russia cut gas supplies to Europe amid tensions over Moscow’s invasion of Ukraine, and lingering consequences of the coronavirus pandemic continued to clog supply chains of parts and raw materials.

As inflation gradually slows from those peaks, the bank is looking to encourage economic growth once more with rate cuts, though observers say these are likely to be very gradual, particularly in light of the latest figures.