Baden-Wuerttemberg CPI
June: +0.1% m/m, +1.0% y/y
May: +0.2% m/m, +1.4% y/y
—
Pan-German CPI
MNI median forecast: +0.1% m/m, +0.9% y/y
MNI forecast range: -0.1% to +0.2% m/m
May: +0.1% m/m, +1.2% y/y
—
BERLIN (MNI) – Consumer prices in the western German state of
Baden-Wuerttemberg rose by 0.1% in June, dampening the annual rate to
1.0% from +1.4% in May, the state statistics office said Monday.
The monthly rise was in line with the 0.1%-median forecast for
pan-German CPI in a MNI survey of analysts. Other states whose monthly
inflation rates matched the overall German median forecast include
Saxony and Brandenburg, while both Hesse and North-Rhein Westphalia were
unchanged compared to May.
As in other states, the strongest jumps were noted in energy
prices, as evidenced by the 23.8% y/y rise in heating oil costs.
However, more expensive heating oil was not enough to prevent a 0.2%
annual drop in household energy prices in June.
Motor fuel prices were up 8.2% on the year but down signficantly
from the +14.7% growth rate in May, while prices fell for the second
time in a row in monthly terms.
Inflation rates will likely remain near their current levels for
the coming months given the huge spare capacity in the German economy.
Wage growth in all likelihood will remain subdued. Trade unions so far
this year have settled for moderate wage deals.
Deflation risks are still relatively low, analysts argue, noting
that the weak euro exchange rate is making imports more expensive. They
also point out that corporate selling price expectations have turned
around recently.
Others, however, reckon that imported inflation is offset by strong
downward pressure on underlying domestic prices and warn that deflation
remains a threat for the Eurozone as a whole.
The Bundesbank earlier this month forecast German average inflation
of +1.2% this year and +1.6% next year.
For detailed information see data table on MNI MainWire.
–Berlin bureau: +49-30-22 62 05 80; email: twidder@marketnews.com
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