February: +1.1% m/m, +11.9% y/y

MNI survey median: +1.0% m/m, +11.7% y/y
MNI survey range: +0.9% to +1.1% m/m

January: +1.5% m/m, +11.8% y/y

FRANKFURT (MNI) – German import prices rose slightly more than
generally expected in February, but at a slower pace than in January,
data released Friday from the Federal Statistical Office showed.

The 1.1% monthly increase left import prices 11.9% higher than they
were one year ago.

Imported energy prices in February saw the largest monthly rise of
any major category. The 3.7% spike pushed the annual increase to 34.8%.
Excluding energy, the price index for imported goods was only 0.6% above
January’s level and 7.8% higher on the year.

Supply uncertainties resulting from the political upheaval in Libya
and the Middle East, combined with worries about increased energy demand
from Japan in the wake of the country’s nuclear disaster, are likely to
keep oil markets jittery and sustain inflationary pressures.

Prices for imported intermediate goods, one of the first groups to
be affected by higher prices for raw materials, saw an increase in
February of 0.9%, giving a 14.9% rise on the year.

Among other categories, capital goods prices were down 0.1% on the
month but rose 0.2% on the year. Consumer goods were up 0.1% on the
month and 4.3% higher in annual terms.

Export prices were up 0.4% on the month and 5.4% higher on the
year.

European monetary policy-makers have made it clear that they are
concerned about inflation spiraling out of control and are committed to
intervening against excessive price rises.

“We must take care that no [inflation] spiral occurs and that the
pressures relating to food prices and other commodities don’t affect
other prices,” European Central Bank Governing Council member Erkki
Liikanen said Thursday.

“Monetary policy cannot affect [international commodity] prices,
but the ECB must of course make its decisions taking these factors into
consideration,” he added.

The ECB is widely expected to hike rates at its next meeting April
7. It would be the bank’s first rate change in nearly two years.

–Frankfurt bureau: +49-69-720142; email: frankfurt@marketnews.com

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