Inflation figures in France and Spain have fallen short of predictions, which is suggesting a need for more interest-rate cuts from the European Central Bank. In France, the consumer-price growth remained stable at 0.9%, contrary to expectations of an increase. Meanwhile, in Spain, the inflation rate slowed to 2.2%, a more significant decline than anticipated, bringing it close to the ECB's 2% target. The bond market in Europe experienced gains, with reductions in the yields of German, French, and Spanish 10-year bonds. Traders are now betting on the possibility of more rate cuts by the ECB, totaling 60 basis points, equivalent to two quarter-point reductions with a 40% likelihood of a third. This data, released on Friday, offers an initial insight into price trends in Europe this month. It will be a key factor in the ECB's upcoming rate decision amidst uncertainties surrounding factors such as President Donald Trump's tariffs and increased military spending in Europe. The recent remarks from ECB officials have been varied on the future course of action, with some advocating for continued easing while others are suggesting a pause. Both France and Spain have seen inflation rates below the ECB target, with France experiencing seven consecutive months below the goal. In March, price declines were observed in energy and manufactured goods sectors in France, while the services sector saw a slight increase. Spain's slowdown was mainly driven by lower electricity prices, with core inflation dropping to 2% after excluding energy and some food prices.