German Inflation Rate Confirmed At Highest Since July 2013


Consumer prices in Germany rose 1.7 percent year-on-year in December of 2016, compared to a 0.8 percent rise in November and matching preliminary estimates. It was the highest inflation rate since July 2013, due to a faster increase in prices of food and services and a surge in cost of transport.

Year-on-year, energy cost (total) increased by 2.5 percent, following a 2.7 percent drop in November. Prices were up sharply for mineral oil products (+9.0 percent, of which light fuel oil: +21.9 percent, motor fuels: +6.0 percent). Prices went up slightly for electricity (+0.9 percent) and solid fuels (+0.1 percent). In contrast, cost fell for central and district heating: -6.4 percent and gas prices: -2.7  percent.

Prices of food and non-alcoholic beverages went up 2.3 percent, after gaining 1.2 percent in the previous month. Prices increased markedly for edible fats and cooking oils (+12.3 percent) and vegetables (+9.7 percent). Also, prices were higher for fish and fish products (+3.3 percent), fruits (+1.4 percent) and confectionery (+1.3 percent).

Cost of goods as a whole rose 1.8 percent, following a 0.5 percent rise in the preceding month, mainly as a result of increases in energy and food prices. Cost of services rose 1.5 percent in December, following a 1.1 percent gain in the previous month. Among services, cost went up for: maintenance and repair of vehicles (+2.3 percent), insurance (+2.3 percent) and social services (+4.3 percent). In contrast, cost dropped for telecommunication services (-1.2 percent).

On a monthly basis, consumer prices went up 0.7 percent, after gaining 0.1 percent in the prior month and in line with consensus. It was the highest figure since March 2016. Cost went up for: energy (+2.3 percent,  including heating oil: +11.7 percent; motor fuels: +3.6 percent) and services (+1.1 percent, mainly due to a 20.9 percent rise in package of holidays). Prices also increased for food and non-alcoholic beverages (+0.7 percent). In contrast, cost of clothing & footwear declined by 2.3 percent.

The harmonized index of consumer prices (HICP) rose 1.7 percent from a year earlier, following a 0.7 percent rise in November. On a month-on-month basis, the index increased by 1.0 percent, after remaining unchanged in the preceding month and matching preliminary figures.

German Inflation Rate Confirmed At Highest Since July 2013


Destatis l Rida Husna | rida@tradingeconomics.com
1/18/2017 8:04:22 AM