Saxony CPI

September: +0.3% m/m, +2.6% y/y
August: -0.1% m/m, +2.4% y/y
—
Pan-German CPI

MNI median forecast: -0.1% m/m, +2.5% y/y
MNI forecast range: -0.3% to +0.1% m/m

August: flat m/m, +2.4% y/y
—

BERLIN (MNI) – Consumer prices in the eastern German state of
Saxony rose 0.3% in September, lifting the annual inflation rate to
+2.6% from +2.4%, the state statistics office said Wednesday.

The monthly result is above the median forecast of -0.1% for
pan-German CPI in a MNI survey of analysts. The annual rise was the
strongest since October 2008, the statistics office pointed out.

Upward pressure on monthly inflation came from clothing and shoes,
which spiked 9.2%. On the energy side, heating oil prices rose 4.4%,
motor fuel 1.9%, gas prices 1.7%, and electricity prices remained
unchanged.

After the holiday period, prices for packaged holiday tours fell
8.8%, airline tickets were 2.8% cheaper and restaurant and hotel
services dropped also 2.8%.

Food prices fell 0.1% with seasonal produce down 2.0%.

In the annual comparison, heating oil prices rose 23.9%, motor fuel
prices 13.1%, electricity 4.6% and gas 2.2%. Food prices rose 2.6% while
seasonal produce fell 5.4%. Clothing and shoes were up 5.5%.

CPI excluding energy and seasonal food rose 0.2% on the month and
1.9% on the year.

Inflation pressures in Germany are expected to ease in the near
future on the back of a deteriorating economic outlook.

Due to slowing global growth, energy and crude oil prices should
decline slightly, the finance ministry predicted last week. “Thus, in
the further course of the year a gradual easing of inflation can be
expected,” it said.

The ministry pointed to signals for slowing industry growth ahead.
“Looking at leading indicators, one can expect a rather moderate pace
for the overall economy in the remainder of the year,” it said.

Economics Minister Philipp Roesler said Monday that the risks for
the domestic economy have risen markedly but a recession is still not to
be expected.

The minister pointed to dangers from the turbulence in financial
and foreign exchange markets, the Eurozone debt crisis and the slowing
of the global economy.

Business morale in Germany fell in September to its lowest level
since June 2010, with businesses revising down their assessments of both
the current situation and the near-term outlook in Germany, the Ifo
institute reported on Monday.

For detailed information see data table on MNI MainWire.

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

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