Saxony CPI

October: +0.2% m/m, +2.7% y/y
September: +0.3% m/m, +2.6% 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 eastern German state of
Saxony rose 0.2% in October, lifting the annual inflation rate to +2.7%
from +2.6%, the state statistics office said Thursday.

The monthly result is above the median forecast of +0.1% for
pan-German CPI in a MNI survey of analysts. The western German state of
North Rhine-Westphalia on Wednesday posted a monthly inflation drop of
0.3%.

Upward pressure on monthly consumer price developments in Saxony
came from clothing and shoes, which were 1.4% more expensive than a
month ago. Food prices rose 0.2% with seasonal produce down 1.2%.

Energy price developments were mixed with heating oil up 2.4%, gas
up 2.0% and electricity up 0.1% while motor fuel fell 0.8%.

Packaged holiday tours were down 1.1% on the month while hotel and
restaurant services fell 0.2%.

Annual price developments were driven mainly by energy price
increases. Heating oil rose 27.6%, motor fuel 12.5%, gas 6.5% and
electricity 4.6%.

Food prices climbed 3.2% with seasonal produce down 4.9%. Clothing
and shoes rose 5.6%.

CPI-ex energy and seasonal food was up 0.2% on the month and 1.9%
on the year.

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.

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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