As Mike was noting earlier we had some German state inflation data for March and the list is now complete ahead of the main German CPI figure at 13.00 gmt

A round up of all y/y figures

  • Saxony 0.9% vs 1.2% prior
  • Brandenburg 1.0% vs 1.2% prior
  • Hesse 1.0% unch
  • Bavaria 0.9% unch
  • North Rhine 1.4% vs 1.6% prior
  • Added: Baden Wuerttemberg 1.0% vs 1.1% prior

For the German release the market is looking for a fall to 1.1% from 1.2% in CPI and 0.9% from 1.0% in the EU HICP.

On Monday we have the March flash EZ inflation number and early estimates are looking for a drop to 0.6% from 0.7%, and more importantly a drop back in the core to 0.8% from 1.0%. In this environment, and if the German numbers miss to the downside then we can expect to see further weakness in the euro as the deflation spectre raises it’s head again into the EZ numbers. If we get an upside surprise then we could see it find support.