Baden-Wuerttemberg CPI

October: +0.3% m/m, +2.8% y/y
September: flat m/m, +2.5% y/y
—
Pan-German CPI

MNI median forecast: +0.1% m/m, +2.6% y/y
MNI forecast range: -0.1% to +0.1% m/m

September: +0.1% m/m, +2.6% y/y
—

BERLIN (MNI) – Consumer prices in the western German state of
Baden-Wuerttemberg rose by 0.3% in October, lifting the annual inflation
rate to +2.8% from +2.5% in September, the state statistics office said
Thursday.

The monthly rise was above the +0.1% median forecast for pan-German
CPI in a MNI survey of analysts. North-Rhine Westphalia earlier posted a
drop of 0.3%, Hesse a flat reading, Brandenburg a 0.1% rise, Saxony a
0.2% rise and Bavaria a 0.3% rise.

Similar to the other states, upward pressure on monthly consumer
price developments in Baden-Wuerttemberg came from clothing and shoes,
which were 2.0% more expensive than a month ago.

Heating oil prices were up 2.3% and motor fuel rose 0.2%. Food
prices climbed 0.3% with seasonal produce down 0.8%. Packaged holiday
tours were down 1.1% on the month, while hotel and restaurant services
were up 0.4%.

In an annual view, heating oil prices were up 26.9% and motor fuel
prices increased 12.4%. Food prices climbed 2.6%, with seasonal produce
down 4.7%. Clothing and shoes rose 3.6%.

Inflation pressures in Germany are expected to ease over the coming
time on the back of a deteriorating economic outlook.

Business morale in Germany cooled further in October, reaching its
lowest level since July 2010, with businesses revising down their
assessments of both the current situation and the near-term outlook in
Germany, the Ifo institute reported last week. After a 7.0-point slide
since June, Ifo’s overall sentiment indicator fell another 1.0 point to
106.4.

Germany’s DIW economic research institute on Wednesday predicted a
stagnation of German GDP in the fourth quarter. Due to the Eurozone’s
sovereign debt crisis, German consumers as well as businesses will
likely delay long-term spending and investment decisions, the
Berlin-based institute said.

The German finance ministry said last week that, while the recent
rise of core inflation in Germany might be partly due to firms passing
on higher labor costs to consumers, the weakening global economy will
likely lead to easing imported inflation pressure.

For detailed information see data table on MNI MainWire.

–Berlin bureau: +49-30-22 62 05 80; email: twidder@marketnews.com

[TOPICS: M$G$$$,M$X$$$,MAGDS$,M$XDS$,MT$$$$]