Germany: Inflation remains stable in June
June 28, 2011
In June, consumer prices rose 0.1% over the previous month, according to preliminary calculations released on 28 June by the National Statistics Institute (Destatis). The monthly rise followed the stalled result observed in May but fell short of market expectations, which had anticipated consumer prices would rise 0.2% As a result of the monthly rise, inflation remained unchanged at May's 2.3%, after inflation reached in April its highest level since October 2008. According to Destatis, the annual consumer price reading reflected higher prices for energy, especially for household use and motor fuels. At the current level, inflation remained above the European Central Bank's inflation target of ?below but close 2%? for the sixth straight month. That said, HICP inflation (based on the harmonized index of consumer prices), followed suit in June and matched May's 2.4%. Complete and more detailed inflation data will be published on 12 July. Meanwhile, the Bundesbank has revised its inflation projections and now anticipates annual consumer prices to average 2.5% this year, up from its previous 1.7% estimate. For 2012, the Central Bank expects inflation to rise 1.8%, above than their previous 1.6% projection.
Author: Ricardo Aceves, Senior Economist