Germany Inflation


Germany: Inflation drops to lowest level in over four years

April 11, 2014

In March, consumer prices added 0.3% over the previous month, confirming the preliminary estimate released by the Federal Statistics Office (Destatis) on 28 March. The increase came in below the 0.5% rise observed in February and fell short of the 0.4% increase the market had expected. According to Destatis, the monthly increase showed that higher prices for clothing and footwear offset lower food and energy prices.

Annual headline inflation eased for the third consecutive month, falling from 1.2% in February to 1.0% in March, which undershot the 1.1% rate the market had expected and marked the lowest level since August 2010. In March, annual average inflation inched down from February's 1.5% to 1.4%.

Meanwhile, annual HICP inflation (based on the harmonized index of consumer prices) fell from 1.0% in February to 0.9% in March. Annual average HICP inflation also inched down, declining from February's 1.5% to 1.4% in March.

The German Central Bank expects inflation to average 1.3% in 2014 before increasing to 1.5% in 2015. FocusEconomics panelists expect inflation to average 1.4% in 2014, which is down 0.1 percentage points from the previous month's forecast. For 2015, panelists expect inflation to increase to 1.9%.


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Germany Inflation Chart

Germany Inflation March 2014

Note: Month-on-month and year-on-year changes of consumer price index in %.
Source: Federal Statistics Office and FocusEconomics calculations.

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