Euro-Zone March PPI dropped 0.7% m/m and 3.1% y/y, after a revised -0.4% m/m and -1.7% (median -1.8%) in February. The decline was stronger than anticipated and the drop over the year the strongest in 22 years. Energy prices remain a key driving factor, with energy prices down 1.7% m/m and 7.3% y/y. However, prices for intermediate goods and non-durable goods are also sharply down on the year as lower oil prices start to feed through the product chain and annual price increases for capital goods and durable consumer goods are starting to level off, so base effects will continue to bring the headline rate down further in coming months.