Germany: Inflation rises more than expected in June
June 28, 2013
In June, consumer prices rose 0.1% over the previous month, according to preliminary estimates released by the Federal Statistics Office (Destatis). The reading was below the 0.4% increase recorded in May but came in slightly above market expectations that had prices remaining unchanged.
As a result, annual headline inflation climbed from 1.5% in May to 1.8% in June, exceeding market expectations that had inflation rising to 1.7%. Despite the faster annual increase, annual average inflation stabilized at the 1.8% observed both in May and April.
Meanwhile, annual HICP inflation (based on the harmonized index of consumer prices) followed suit and rose from 1.6% in May to 1.9% in June. Annual average HICP inflation remained unchanged at May's 1.9%.
The Bundesbank expects inflation to average 1.6% in 2013, before inching down to 1.5% in 2014. FocusEconomics panellists expect inflation to average 1.6% in 2013, which is unchanged from the previous month's forecast. For 2014, panellists expect inflation to increase to 1.8%.
Author: Ricardo Aceves, Senior Economist